Fueling Strategy: Please fill as needed today/tonight, Friday AM wholesale prices will remain flat – Be Safe
NYMEX Crude $ 53.18 UP $.0700
NY Harbor ULSD $1.6495 DN $.0025
NYMEX Gasoline $1.7349 DN $.0068
NEWS
Oil prices posted a slight gain Thursday, notching a third consecutive weekly advance, as traders continued to weigh the prospects and timing for a balance between supply and demand in the market.
On Thursday, data revealed that the number of active U.S. oil rigs has climbed for a 13th week in a row, feeding concerns over growth in domestic crude output, but a report from an energy watchdog indicated that the market is “very close” to a balance after years of global oversupply. Crude oil for May delivery rose 7 cents, or 0.1%, to settle at $53.18 a barrel on the New York Mercantile Exchange. It settled 1.8% above last Friday’s finish. Brent for June added 3 cents, or less than 0.1%, to $55.89 a barrel—up about 1.2% for the week. The number of active U.S. rigs drilling for oil rose by 11 to 683 rigs this week, according to Baker Hughes which released its figures a day earlier citing, a holiday on Good Friday. The oil-rig count, which implies further output growth, has climbed nearly every week so far this year.
Production in the U.S. has been increasing, as other major producers cut back as part of an agreement led by the Organization of the Petroleum Exporting Countries. Data from the Energy Information Administration this week showed a decline in weekly U.S. crude supplies, but also revealed a jump in production to its highest level in more than a year last week. In a separate report, the agency forecast record output for next year. But the International Energy Agency, in its monthly report released Thursday, said global oil supply fell in March. “It can be argued confidently that the market is already very close to balance, and as more data become available this will become clearer,” the agency said.
Matthew Parry, senior oil economist at the IEA, told MarketWatch there is a possibility for a global crude stock draw of 1 million barrels a day in the second quarter of this year, “depending upon OPEC/non-OPEC cut compliance.” Supplies in the Organisation for Economic Co-operation and Development, a group of industrialized countries, may even fall below year-ago levels toward the end of the second quarter to early third quarter—which “could be a psychologically important indicator,” he said. Still, prices spent much of Thursday wavering between slight losses and gains.
OPEC members exceeded production-cut targets in March and given “the positive sentiment from the [International Energy Agency] around a rebalancing market, there are plenty of positives for oil investors,” said Enrico Chiorando, a U.K.-based analyst at energy consultancy Love Energy. “However, while the margin is tightening, global supplies remain high and the continued growth in U.S. production will continue to weigh down the recovery,” he said in an emailed note.