Fueling Strategy: Please keep tanks topped especially tonight, Thursday AM wholesale prices will jump UP 5 cents – Be Safe Today!
NYMEX Crude $ 48.75 UP $.8600
NY Harbor ULSD $1.5953 UP $.0268
NYMEX Gasoline $1.6173 UP $.0211
NEWS
Oil prices finished at their highest level in about two months Wednesday, buoyed by data showing a fourth consecutive week of declines in U.S. crude inventories. Prices had already posted gains in the last two sessions, with Tuesday’s move marking the biggest single-session rise of the year so far.
Some members of the Organization of the Petroleum Exporting Countries have promised to cut back exports, traders are showing concern about Venezuelan oil supplies ahead of a national vote Sunday, and there are signs of a possible slowdown in U.S. crude production in the wake of reduced spending plans for some oilfield services companies.
On the New York Mercantile Exchange Wednesday, September West Texas Intermediate crude rose 86 cents, or 1.8%, to settle at $48.75 a barrel—the highest finish for a most-active contract since May 30, according to FactSet. September Brent crude on London’s ICE Futures exchange rose 77 cents, or 1.5%, to $50.97, with prices also logging the lowest finish since late May.
The U.S. Energy Information Administration reported Wednesday that domestic crude supplies fell by 7.2 million barrels for the week ended July 21. That topped the forecast for a decline of 2.5 million barrels by analysts surveyed by S&P Global Platts, though The American Petroleum Institute had reported a larger weekly fall of 10.2 million barrels late Tuesday. It was “a fairly robust report all round, led by a solid draw to crude inventories,” said Matt Smith, director of commodity research at ClipperData. Petroleum products also saw supply declines, “despite higher refinery runs, with implied demand looking buoyant.” Gasoline stockpiles fell by 1 million barrels, while distillate stockpiles lost 1.9 million barrels last week, according to the EIA. The S&P Global Platts survey forecast a fall of 1.25 million barrels for gasoline stocks and a decline of 800,000 barrels for distillates, which include heating oil.
On Nymex, August gasoline added 2.1 cents, or 1.3%, to $1.617 a gallon and August heating oil added 2.7 cents, or 1.7%, to $1.595 a gallon. Meanwhile, August natural gas shed 2 cents, or 0.7%, to $2.924 per million British thermal units, giving back some of the 1.6% rise it saw a day earlier as traders awaited the EIA’s weekly update on natural-gas stockpiles due Thursday.
The EIA data Wednesday also showed a modest fall of 19,000 barrels a day in total domestic crude production to 9.41 million barrels a day. The decline, along with cuts to spending among some oil-and-gas exploration and production companies, helps to ease ongoing concerns that U.S. crude production will offset efforts by the Organization of the Petroleum Exporting Countries and its allies to drawdown a glut of global supplies. Tyler Richey, co-editor of the Sevens Report, said the output fall was the first in a month, and it was paired with comments earlier this week suggesting U.S. producers are “poised to dial down their production growth efforts.” But he also pointed out that output in the lower 48 states actually rose 35,000 barrels a day to break through 9 million barrels a day for the first time in over two years. The EIA noted in a report Tuesday that crude-oil production is expected to reach a record annual level in 2018.
Meanwhile, oil showed little reaction to the U.S. Federal Reserve’s policy statement Wednesday, but “continued momentum in the economy is going to help the overall demand for oil, which in turn will accelerate” OPEC-led efforts to rebalance the market, said Mark Watkins, regional investment manager at the Private Client Group at U.S. Bank in Utah.
Have a great day,
Loren R. Bailey, Founder & Owner
FUEL MANAGER SERVICES INC
“Serving the Trucking Industry Since 1992”