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Market Close: July 02 Down

Fueling Strategy: Please keep tanks topped today/tonight, Wednesday prices will go UP 1.50 cents – Be Safe
NYMEX Crude    $ 56.25 DN $2.8400
NYMEX ULSD     $1.8863 DN $0.0675
NYMEX Gas       $1.8703 DN $0.0602
NEWS

Oil prices fell about 3% on Tuesday, even after OPEC and allies including Russia agreed to extend supply cuts until next March, as weak manufacturing data had investors worried that a slowing global economy could dent oil demand. Brent crude fell $2.61, or 4.01%, to $62.45 a barrel. WTI crude fell $2.84, or 4.8%, to $56.25 a barrel, after touching their highest in more than five weeks on Monday.

The Organization of the Petroleum Exporting Countries and other producers such as Russia, a group known as OPEC+, agreed on Tuesday to extend oil supply cuts until March 2020 as members overcame differences to try to prop up prices. The extension comes after Russian President Vladimir Putin said on Saturday he had agreed with Saudi Arabia to prolong the pact and continue to cut combined production by 1.2 million barrels per day, or 1.2% of world demand. “There seems to be some disappointment that OPEC didn’t make a larger production cut. Or a sense that demand is really bad,” said Phil Flynn, analyst at Price Futures Group in Chicago.

Signs of a global economic slowdown, which could hit oil demand growth, means OPEC and its allies could face an uphill battle to shore up prices by reining in supply. “It was the bare minimum OPEC could agree on in order to prevent a major meltdown in prices. Member countries noted that global oil demand growth for this year has fallen to 1.14 mbpd (million barrels per day) whilst non-OPEC supply is expected to grow by 2.14 mbpd,” PVM analyst Tamas Varga wrote in a note. “It appears that the supply side of the oil equation is supportive for oil prices but demand concerns are forcing oil bulls to keep at least part of their gunpowder dry.”

The United States and China agreed at the G20 leaders summit to restart trade talks, but factory activity shrank across much of Europe and Asia in June while U.S. manufacturing activity slowed to near a three-year low. Further, U.S. President on Monday said any deal would need to be somewhat tilted in favor of the United States, which stoked doubt over prospects for a trade deal between the top two economies.

Meanwhile, U.S. crude oil stockpiles were seen falling for a third consecutive week, a preliminary Reuters poll showed. Industry data will be released at 4:30 p.m. EDT, with government data to follow on Wednesday.

Have a Great Day,
Loren R Bailey, President
Fuel Manager Services Inc.
Office: 479-846-2761
Cell: 479-790-5581
Categories: Fuel News
loren: Fuel Manager Services Inc. "Serving the trucking industry since 1992" I've been in and around the trucking industry for 45-years beginning in owner operator operations at Willis Shaw Express. I bought a small trucking company that I ran for 6-years then sold and went to work for J.B. Hunt Transport in 1982. After 10-years with Hunt, I started Fuel Manager Services, Inc., we are in our 29th year of serving the American trucking companies. Our simple goal was and is to bridge the gap between the trucking companies and the fuel suppliers.