Fueling Strategy: Please keep tanks topped tonight, Wednesday AM wholesale prices will jump up 1.50 cents and due to hurricane Harvey will most likely continue going up until refineries can be evaluated, Thursday AM look for a 3+ cent jump – Be Safe Today

NYMEX Crude $ 46.44 DN $.0013
NY Harbor ULSD $1.6655 UP $.0303
NYMEX Gasoline $1.7833 UP $.0710

NEWS
U.S. oil prices on Tuesday settled at their lowest level in more than a month as refinery outages in the wake of Hurricane Harvey continued to spark fears of diminished demand for U.S. oil. But prices for West Texas Intermediate crude finished off the session’s worst levels as traders bet that preparations for the storm resulted in a drawdown of oil supplies. October WTI crude the U.S. benchmark, fell 13 cents, or 0.3%, to settle at $46.44 a barrel on the New York Mercantile Exchange. Prices lost 2.7% Monday and settled Tuesday at their lowest since July 24, according to FactSet data.

The moves for oil came as flooding and rain in the aftermath of Hurricane Harvey continued to buffet Texas with once-in-a-generation flooding. The storm is already estimated to have reduced refining capacity in the area by more than 2 million barrels a day, boosting gasoline prices to their highest in more than two years, but adding pressure on U.S. crude. September gasoline jumped 7.1 cents, or 4.2%, to $1.783 a gallon. Prices, based on the front-month contracts, finished the session at their highest since July 31, 2015. “While production of crude oil has been hampered by the storm, the refinery shut-ins have crimped demand for oil,” said Nitesh Shah, director and commodities strategist at ETF Securities.

On the ICE Futures Europe exchange, October Brent oil rose 11 cents, or 0.2%, at $52 a barrel. The global benchmark wasn’t hit as hard by the Harvey carnage on Monday, because it is expected that the U.S. will demand more oil from Europe as its own production and refining get back up to speed. The spread between WTI and Brent is now above $5 for the first time in two years. “The fact that U.S. Gulf Coast refinery capacities of approximately 2.5 million barrels per day are out of action because of Hurricane Harvey is weighing on WTI. By contrast, the oil production outages in the Gulf of Mexico and at the Eagle Ford shale play amount to less than 1 million barrels per day,” analysts at Commerzbank said in a note. “What is more, oil production is likely to be ramped up more quickly again than crude oil processing. Further heavy rainfall is expected on the Gulf Coast until the end of the week. The flooding will thus continue for some time to make it difficult for refinery operation to be resumed, for damage to be assessed and for essential repair work to be carried out,” they added.

The energy market will get an update on weekly U.S. petroleum supplies from the American Petroleum Institute late Tuesday and the Energy Information Administration early Wednesday. “We will see the impact of some early closures ahead of the storm” since the data covers the week ended Aug. 25, said Phil Flynn, senior market analyst at Price Futures Group. “We are expecting big draws across the board for oil and products.” Analysts polled by S&P Global Patts expect a fall of 1.5 million in crude supplies, a decline of 1.9 million for gasoline stockpiles and a drawdown of 600,000 barrels for distillates.

Have a great day,

Loren R. Bailey, President
Fuel Manager Services Inc
“Serving the Trucking Industry Since 1992”
www.FuelManagerServices.com
Cellular: 479-790-5581
Office: 479-846-2761