Fueling Strategy: Please partial fill only tonight, Saturday AM wholesale prices will drop 2 cents then Sunday AM look for wholesale prices to go down 4 cents – Be Safe Today!!
NYMEX Crude $ 49.07 DN $1.4900
NY Harbor ULSD $1.5160 DN $0.0352
NYMEX Gasoline $1.5596 DN $0.0590
NEWS
Oil futures settled lower on Friday, with U.S. prices falling back below $50 a barrel as traders worried that recent price gains, including a 0.9% rise this week, could prompt a rebound in crude production.
Strength in the U.S. dollar and negative sentiment across financial markets ahead of next week’s U.S. Federal Reserve meeting on interest rates also weighed on prices. July West Texas Intermediate crude lost $1.49, or 3%, to settle at $49.07 a barrel on the New York Mercantile Exchange. Prices still gained roughly 0.9% for the week after settling at a nearly 11-month high above $51 on Wednesday. August Brent crude fell $1.41, or 2.7%, to $50.54 a barrel on London’s ICE Futures exchange, but still gained around 1.8% for the week.
Oil prices extended their decline after Friday’s U.S. oil-rig count from Baker Hughes Inc. which is a rough proxy for activity in the industry, revealed a second straight weekly climb. The number of domestic rigs actively drilling for oil rose by 3 to 328. With prices now at levels that make drilling economical for some firms, analysts say the rig count might continue to rise and the U.S. production declines might slow. This would in turn threaten the price recovery.
Early this week, prices got a boost from production outages, particularly in Nigeria where militants have disrupted the flow of oil. This put extra upward pressure on the oil complex, which pushed prices above the $50 level for WTI crude, said Nico Pantelis, head of research at Secular Investor. But that price level is “an area of firm resistance on the price chart, as we see that technicals are being tested, while the U.S. dollar is stabilizing.” “Next week, oil traders will start focusing on fundamentals again, as the economy is still lackluster around the world,” he said. “We expect a retracement of prices towards the $43-level.” Traders will get a better overall view of the oil market from monthly reports due Monday from the Organization of the Petroleum Exporting Countries Monday and from the International Energy Agency on Tuesday. The U.S. Energy Information Administration will also release its monthly data on domestic shale production Monday.
Analysts at Commerzbank attributed Friday’s weakness in crude to poorer sentiment on financial markets rather than to the fundamental situation in oil. U.S. equities fell Friday, before next week’s Fed meeting, where policy makers will deliberate the direction of U.S. interest rates—a decision that has an effect on the dollar. Meanwhile, a vote later this month could see the U.K. leave the European Union. “A higher Fed rate would increase the value of holding dollar-denominated debt, which would increase the value of the dollar, in turn making crude more expensive for consumers using a currency other than dollars, which would decrease demand,” said Daniel Holder, commodity analyst at Schneider Electric. The ICE U.S. Dollar Index was trading 0.6% higher on Friday.