Fueling Strategy: Please keep tanks topped today/tonight, Friday AM wholesale prices will jump UP 3 cents – Be Safe Today!
NYMEX Crude $ 50.56 DN $.6700
NY Harbor ULSD $1.5512 DN $.0193
NYMEX Gasoline $1.6186 DN $.0012
NEWS
Natural-gas futures soared on Thursday to mark their highest settlement since late September, after a weekly report showed that supplies of the commodity rose less than the market expected.
Oil prices, meanwhile, finished lower after hitting their highest levels in almost 11 months, buoyed by global production disruptions and falling U.S. crude inventories. The U.S. Energy Information Administration early Thursday reported that domestic supplies of natural gas in storage rose 65 billion cubic feet for the week ended June 3. That was below the average rise of 80 billion cubic feet expected by analysts polled by S&P Global Platts.
The smaller weekly increase “suggests that U.S. gas production is falling as we start to face record demand,” said Phil Flynn, senior market analyst at Price Futures Group. He said demand is 8% higher than a year ago, even though summer cooling demand for the commodity hasn’t yet begun. Total stocks stand at 2.972 trillion cubic feet, up 660 billion cubic feet from a year ago and 722 billion cubic feet above the five-year average, the EIA data showed. “Mexico is demanding more U.S. gas, a warm summer should boost power generation demand in the U.S., and production levels have been challenged so far in 2016,” said Robbie Fraser, commodity analyst at Schneider Electric. “That trio has sent prices higher, even as total storage and production levels remain considerably elevated.”
Oil retreat
Meanwhile, after a three-session climb to the highest level in almost 11 months, oil futures pulled back Thursday as some analysts raised concerns that the recent price rally would prompt higher production. July West Texas Intermediate crude shed 67 cents, or 1.3%, to end at $50.56 a barrel on the New York Mercantile Exchange. Prices settled Wednesday at $51.23, their highest since July 15 of last year. August Brent crude on London’s ICE Futures exchange lost 56 cents, or 1.1%, to $51.95 a barrel after finishing Wednesday at $52.51, the highest futures settlement since October. “Although there is potential for a small decline to develop into a more significant drop, so far this looks like a modest technical correction following three days of gains rather than a major reversal,” said Tim Evans, energy analyst at Citi Futures and OTC Clearing. But some were even less optimistic. There is a real risk that rising profitability may encourage more production, said Barnabas Gan, economist at OCBC Bank, cautioning that the oil price slump over the past few months had after all been triggered by a flood of oil supplies.
Data from the U.S. Energy Information Administration Wednesday showed that U.S. crude stockpiles fell by 3.2 million barrels last week, but total crude output increased by 10,000 barrels, raising questions about whether the rebounding market is already leading U.S. producers to pump more. Prices have climbed as global output has declined. Unplanned global-oil supply disruptions averaged more than 3.6 million barrels a day in May 2016—that’s the highest monthly level recorded since the EIA started tracking global disruptions in January 2011.