Fueling Strategy: Please partial fill only tonight due to Thursday AM wholesale prices will fall another penny – Be Safe
NYMEX Crude $ 50.44 DN $1.9700
NY Harbor ULSD $1.5813 DN $0.0406
NYMEX Gasoline $1.6602 DN $0.0520
NEWS
Oil prices suffered their largest one-day loss in six weeks as a steep drop ahead Wednesday’s settlement pushed prices to their lowest finish in 2½ weeks. An unexpected weekly climb in U.S. gasoline supplies—the first in about two months—had fueled earlier losses, which worsened amid volatile trading tied to Thursday’s expiration of the May West Texas Intermediate crude contract.
WTI prices dropped below $51 after the release of the Federal Reserve’s Beige Book. There was “generally nothing in the Beige Book that would stop the Fed from raising rates in June, so the dollar rallied and added to oil’s expiration lows,” said Phil Flynn, senior market analyst at Price Futures Group. May West Texas Intermediate crude lost $1.97, or 3.8%, to settle at $50.44 a barrel on the New York Mercantile Exchange. Prices saw their largest single-session dollar and percentage loss since March 8 and ended at their lowest since April 3, according to data from Dow Jones. The contract is set to expire at Thursday’s settlement and that tends to feed market volatility as traders adjust positions.
In London, June Brent crude on the ICE exchange shed $1.96, or 3.6%, to $52.93 a barrel—the lowest settlement since March 31.
The U.S. Energy Information Administration early Wednesday reported that crude supplies fell by a more-than-expected 1 million barrels for the week ended April 14. The American Petroleum Institute late Tuesday reported a decline of 840,000 barrels, while analysts polled by S&P Global Platts forecast a fall of 50,000 barrels. Gasoline stockpiles, however, edged up by 1.5 million barrels, defying expectations for a decline of 2 million, according to a survey conducted by S&P Global Platts. Distillate stockpiles fell a bit more than expected—down 2 million barrels last week. “A draw in crude oil inventory was ultimately washed by a surprise build in gasoline,” said John Macaluso, an analyst at Tyche Capital Advisors. “Ahead of summer driving season, it is surprising to see a lag in demand. “
May gasoline fell 5.2 cents, or 3%, to $1.659 a gallon. May heating oil fell 4.1 cents, or 2.5%, to $1.581 a gallon. May natural gas ended at $3.185 per million British thermal units, up 4 cents, or 1.3%, ahead of the EIA’s weekly update on natural-gas inventories due out Thursday.
For oil, Tyler Richey, co-editor of the Sevens Report, said that “the continued rise in U.S. production. remains the biggest headwind for global energy prices right now.” The EIA report showed a weekly rise of 17,000 barrels a day in total U.S. crude production. “Additionally, less optimistic commentary out of OPEC regarding an extension to the joint production cuts into [the second half of 2017] has caused some cautious profit-taking,” he said.
Earlier this week, Saudi Arabia Energy Minister Khalid al-Falih reportedly said it is too early to make a decision on a deal extension.