Fueling Strategy: Please fill as needed tonight, Thursday wholesale prices will go up slightly then Friday plan for a big drop of 6 cents – Be Safe
NYMEX Crude $ 50.28 DN $2.8600
NY Harbor ULSD $1.5567 DN $0.0572
NYMEX Gasoline $1.6526 DN $0.0272
NEWS
Oil futures sank by more than 5% Wednesday to post the lowest finish of the year after U.S. government data revealed a weekly jump in crude supplies that lifted total inventories to another record.
The plunge came even as representatives from the Organization of the Petroleum Exporting Countries this week touted high compliance among the output-cut agreement participants since the start of the year. OPEC Secretary-General Mohammed Barkindo said Tuesday, at a conference in Houston, that the commitment among output cut pact countries “remains high.” But in U.S., which isn’t part of the pact, the latest data revealed that crude production last week reached a more than one-year high.
April West Texas Intermediate crude fell $2.86, or 5.4%, to settle at $50.28 a barrel on the New York Mercantile Exchange and May Brent crude on London’s ICE Futures exchange fell $2.81, or 5%, to $53.11 a barrel. Both marked their lowest settlement since Dec. 7, according to FactSet. The sharp drop in crude futures put pressure on the Dow Jones Industrial Average and the S&P 500 index with the energy sector posting the steepest decline of the broad-market benchmark’s 11 sectors.
The U.S. Energy Information Administration Wednesday reported an 8.2 million-barrel climb in domestic crude supplies for last week, lifting total commercial inventories to a record weekly level of 528.4 million. The weekly climb was the ninth in a row.
Expectations for a large rise in the official data rose after data Tuesday from the American Petroleum Institute showed that domestic crude inventories rose by a whopping 11.6 million barrels in the latest week. Analysts polled by S&P Global Platts had forecast an inventory increase of 1.6 million barrels. “This report runs the gamut in terms of extremes, with a huge 8.2 million barrel build to crude stocks tilted bearish, large draws to the products distinctly bullish,” said Matt Smith, director of commodity research at ClipperData. “The drop in refinery runs doesn’t fully explain the extremities of the inventory changes; crude stocks were bolstered by rebounding imports, while both gasoline and distillates draws were exacerbated by higher implied demand,” he said.
Gasoline supplies dropped by a much bigger-than-expected 6.6 million barrels, while distillate stockpiles were down 2.7 million barrels last week, according to the EIA. The S&P Global Platts survey called for a drop of 2 million barrels in gasoline and a fall of 1.1 million for distillates, which include heating oil.