Fueling Strategy: Fill as needed today wholesale prices are down 4 cents, Saturday AM look for a small move up – Be Safe
NYMEX Crude $ 44.74 UP $.2800
NY Harbor ULSD $1.4270 UP $.0124
NYMEX Gasoline $1.4548 UP $.0191
NEWS
Oil prices rebounded Friday after hitting their lowest settlement of 2017, but registered their fourth weekly loss in a row—the longest such streak of declines in nearly two years. Data earlier in the week showing a rise in U.S. production and weak domestic gasoline demand fed concerns that the global energy market remains awash in surplus oil, keeping pressure on prices.
July West Texas Intermediate crude oil rose 28 cents, or 0.6%, to settle at $44.74 a barrel on the New York Mercantile Exchange, while August Brent on London’s ICE Futures exchange added 45 cents, or 1%, to $47.37 a barrel. However, the gains weren’t enough to bring the contracts into positive territory for the week, with WTI crude down 2.4% and Brent suffering a 1.6% weekly slide. That marked a fourth straight week of losses for both, and the longest weekly losing streak since August 2015 for WTI.
On Thursday, WTI settled at its lowest since Nov. 14, as “bearish investors exploited the unexpectedly large build in gasoline inventories to instigate renewed rounds of selling,” said Lukman Otunuga, research analyst at FXTM, in email commentary.
“The King Dollar’s return weighed heavily on the commodity by making it more expensive for buyers utilizing other currencies,” he said. The ICE U.S. Dollar Index rose Thursday in the wake of the Federal Reserve’s decision to raise interest rates, as expected, but the index weakened a bit Friday. Moves in the dollar can influence the attractiveness of commodities traded in the greenback.
With “oil displaying repeated signs of weakness,” despite the Organization of the Petroleum Exporting Countries and some non-OPEC producers cutting production by 1.8 million barrels a day, and with U.S. shale producers “pumping incessantly, there is a threat of price weakness becoming a recurrent theme,” said Otunuga. The output cuts, which have been extended through March of next year, have so far failed to bring global inventories down to OPEC’s targeted five-year average. “After the first found of OPEC cuts failing to materially change OECD inventories, and global supply and floating storage remaining robust, the outlook for a tightening market continues to be pushed further into the future,” said Troy Vincent, an oil analyst at ClipperData.
Data from Baker Hughes Friday revealing another rise in the number of active U.S. oil rigs, by 6 to 747 for the week, pointed to higher domestic output.
Earlier this week, the International Energy Agency offered a grim forecast that a gusher of new supplies from the U.S. stands to keep the market well-flushed for some time.
Have a great day,
Loren R. Bailey, Founder & Owner
FUEL MANAGER SERVICES INC
“Serving the Trucking Industry Since 1992”