Aug 27th Fueling Strategy: Prices are down slightly today, Please “KEEP YOUR TANKS TOPPED TODAY/TONIGHT” Wednesday prices will JUMP UP 5 Cents ~ Be Safe Today!
NYEX Crude $ 77.42 UP $2.5900
NYMEX ULSD $2.3480 UP $0.0483
NYMEX Gas $2.1190 DN $0.0159
NEWS
Oct WTI crude oil Monday closed up +2.59 (+3.46%), and Oct RBOB gasoline closed up +1.63 (+0.77%).
Crude oil and gasoline prices Monday rallied sharply to 1-week highs. Oil prices moved higher on concern that an escalation of conflict in the Middle East could disrupt oil supplies after more than 100 Israeli warplanes Sunday attacked sites in southern Lebanon to take out hundreds of Hezbollah missile launchers. Crude oil prices also saw support after Libya’s eastern government called for a halt to all crude production and exports due to political conflict over who controls the country’s central bank and oil revenues.
A sharp decline in crude oil held worldwide on tankers is bullish for prices. Vortexa reported Monday that crude oil stored on tankers that have been stationary for at least seven days fell by -24% w/w to 58.06 million bbl in the week ended August 23, the lowest in 4-1/2 years. Weakness in the crude crack spread is bearish for oil prices as the crack spread Monday fell to a 3-1/2 year low, discouraging refiners from purchasing crude oil and refining it into gasoline and distillates.
Signs of weaker US gasoline demand have prompted several US refiners to reduce refining operations, a bearish factor for crude prices. Marathon Petroleum, the owner of the largest US refinery, said it plans to cut its refining capacity rate to 90% this quarter, the lowest for a Q3 since 2020. Also, PBF Energy said it was cutting its refining capacity utilization rate to a three-year low, and Phillips 66 said it would cut its capacity rate to a two-year low.
Increased Russian crude production is negative for oil prices after Russia’s Energy Ministry reported last Friday that Russia’s July crude production was 9.045 million bpd, about 67,000 bpd above the output target it agreed to with OPEC+. OPEC+ rolled out a plan to restore some crude production in Q4, which sparked worries about a glut in global oil supplies. On June 2, OPEC+ extended the 2 million bpd of voluntary crude production cuts into Q3 but said they would gradually phase out the cuts over the following 12 months, beginning in October. OPEC pledged to extend its crude production cap at about 39 million bpd to the end of 2025. Also, the UAE was given a 300,000 bpd boost to its production target for 2025. In June, OPEC crude production fell -80,000 bpd to 26.98 million bpd.
Have a Great Day!
Loren R Bailey, President
Office: 479-846-2761
Cell: 479-790-5581
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As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!
“Celebrating 31-years of Service Excellence”
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