Market Close: June 29 UP, Diesel Up $.0089, Gas Up $.0143
Jun 29th, 2023 by loren
Fueling Strategy: Please fuel as needed today, prices are down 4 cents, Friday prices will go up 1 cent~Be Safe
NMEX Crude $ 69.86 UP $.3000
NYMEX ULSD $2.4156 UP $.0089
NYMEX Gas $2.6177 UP $.0143
NEWS
August WTI crude oil Thursday closed up +0.30 (+0.43%), and Aug RBOB gasoline closed up +0.63 (+0.25%).
Crude oil prices Thursday saw carry-over support from Wednesday’s sharp -9.6 million bbl decline in EIA weekly crude oil inventories, which led to a +2.75% rally in Aug crude oil prices on Wednesday. Crude oil prices also saw support from the strong U.S. economy, as U.S. Q1 GDP was revised higher to +2.0% from +1.3%. However, crude oil prices were undercut by the +0.4% rise in the dollar index and by the sharp +14 bp rise in the 10-year T-note yield on Fed Chair Powell’s latest hawkish comments.
Oil prices continue to be undercut by concern about weaker Chinese energy demand. China’s National Petroleum Corp (CNPC), China’s largest oil and gas producer, cut its 2023 China crude oil demand forecast on June 20 to +3.5% to 740 MMT from a March forecast of +5.1% to 756 MMT. In another sign of weak Chinese oil demand, analytics firm Kpler recently reported that China’s crude oil stockpiles rose to a 2-year high in May of 966 million bbl, well above the five-year average of 858 million bbl.
Crude prices jumped after OPEC+ on June 4 agreed to maintain its crude production levels. However, Saudi Arabia said it would voluntarily cut its crude output by 1 million bpd starting in July, and Saudi Energy Minister Price Abdulaziz bin Salman said he “will do whatever is necessary to bring stability to the oil market.” He also said that July’s additional cuts could be extended, but they will keep the market “in suspense” about whether this will happen. OPEC May crude production fell -500,00 bpd to a 16-month low of 28.26 million bpd.
Thursday’s EIA report showed that (1) U.S. crude oil inventories as of June 23 were -1.4% below the seasonal 5-year average, (2) gasoline inventories were -6.8% below the seasonal 5-year average, and (3) distillate inventories were -14.4% below the 5-year seasonal average. U.S. crude oil production in the week ended June 23 was unchanged at 12.2 million bpd, just mildly below the 3-year high of 12.4 million bpd posted in the week ended June 9. U.S. crude oil production is well below the Feb-2020 record-high of 13.1 million bpd.
Baker Hughes reported last Friday that active U.S. oil rigs in the week ended June 23 fell by -6 rigs to a 1-1/4 year low of 546 rigs. That is well below the 3-1/4 year high of 627 rigs posted on December 2, 2022. U.S. active oil rigs have more than tripled from the 18-year low of 172 rigs seen in Aug 2020, signaling an increase in U.S. crude oil production capacity.
Have a Great Day,
Loren R Bailey, President
Office: 479-846-2761
Cell: 479-790-5581
SCHEDULED OUT OF OFFICE
JULY 07 AT 2:00 PM
JULY 14 AT NOON
JULY 21 AT 3:00 PM
SEPT 01 OUT ALL DAY
NOV 01-02-03 VACATION
Tell Us How We’re Doing On Google Business
https://g.page/r/CUyL9wDolv04EAI/review
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!
“Celebrating 30-years of Service Excellence”
“To give real service you must add something which cannot be bought or measured with money, and that is sincerity and integrity.” ~ Douglas Adams