July 19th Fueling Strategy: Please “FUEL AS NEEDED TODAY/TONIGHT, Saturday prices will go up less than a penny ~ Be Safe Today!
NYEX Crude $ 82.82 DN $.0300
NYMEX ULSD $2.4868 DN $.0072
NYMEX Gas $2.5164 UP $.0151
NEWS
August WTI crude oil on Thursday closed down -0.03 (-0.04%), and Aug RBOB gasoline closed up +1.51 (+0.60%). Crude oil and gasoline prices Thursday gave up an early advance and settled mixed. A stronger dollar Thursday weighed on energy prices. Crude prices also turned lower Thursday after stocks erased an early rally and retreated, which undercut confidence in the economic outlook and energy demand.
Crude prices Thursday initially moved higher as wildfires in Canada threatened to cut 400,000 bpd of oil production. Crude also has carryover support from Wednesday when the EIA reported crude inventories fell more than expected to a 5-month low. Comments Thursday from ECB President Lagarde were bearish for crude when she said, “The risks to economic growth are tilted to the downside, and a weaker world economy or an escalation in trade tensions between major economies would weigh on Eurozone growth.” Crude has support from wildfires in Canada that threaten to curb 400,000 bpd of Canadian crude production, putting crude oil pipeline shipments to the US at risk. Hot weather in Alberta has sparked 50 out-of-control blazes and has reduced Canada’s crude production.
Thursday’s global economic news was mixed for energy demand and crude prices. On the negative side, US weekly continuing claims rose +20,000 to a 2-1/2 year high of 1.867 million, showing a weaker labor market than expectations of 1.856 million. Also, Eurozone May construction output fell -0.9% m/m, the third straight monthly decline and the biggest drop in 14 months. On the positive side, the US July Philadelphia Fed business outlook survey rose +12.6 to 13.9, stronger than expectations of 2.9.
In a bearish factor, Russia’s crude exports in the week to July 14 rose by +200,000 bpd to 2.97 million bpd, according to vessel-tracking data compiled by Bloomberg. Also, higher-than-expected Russian crude output is bearish for oil prices. Russian crude production averaged 9.078 million bpd in June, above its agreed target of 9.049 million bpd.
Crude oil prices have underlying support from the Hamas-Israel conflict. Israel’s military continues to conduct operations in Gaza, and there is the continued risk that the war might spread to Hezbollah in Lebanon or even to a direct conflict with Iran. Meanwhile, ongoing attacks on commercial shipping in the Red Sea by Iran-backed Houthi rebels have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies. A decline in crude oil in floating storage is bullish for prices. Monday’s weekly data from Vortexa showed that the amount of crude oil held worldwide on tankers that have been stationary for at least a week fell -20% w/w to 74.53 million bbl as of July 12.
Have a Great Day!
Loren R Bailey, President
Office: 479-846-2761
Cell: 479-790-5581
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July 19 After Lunch
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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!
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