Fueling Strategy: Please partial fill tonight, Saturday AM wholesale prices will drop one penny – Be Safe Today!!
NYMEX Crude $ 40.39 DN $.1500
NY Harbor ULSD $1.3713 DN $.0005
NYMEX Gasoline $1.2903 UP $.0024
NEWS
Crude-oil futures finished mixed on Friday in an up-and-down trading day as the December West Texas Intermediate oil contract expired.
The expiration of the December contract on Friday increased volatility, leading to swings in prices as traders rolled over to the most-active January contract. December crude settled down 35 cents, or 0.9%, to finish at $40.39 a barrel. January WTI CLF6, -0.62% ended 18 cents, or 0.4%, higher at $41.90/bbl. on the New York Mercantile Exchange. Earlier in the session, weekly data from Baker Hughes showed that the number of U.S. oil-drilling rigs fell by 10 to 564 as of Friday. Natural gas rigs were unchanged at 193 but the fall in oil rigs helped shave the total rig-count number down to 757 rigs for the week. A reduction of rigs offers some promising signs that a glut of supply from U.S. shale producers might abate, after last week showed a small climb, snapping an 11 week decline in weekly oil-rig counts. The Baker Hughes report, which was released at 1 p.m. Eastern, initially helped lift crude-oil prices but the commodity pared its gains in part due to the strength of dollar.
Comments from European Central Bank President Mario Draghi, who reiterated his willingness to unleash further stimulus to help spark growth in Europe’s sluggish economy, weighed on crude prices throughout the session. Draghi’s dovish comments buoyed the dollar and weakened the euro dragging dollar-denominated assets like crude oil lower. A strong buck makes assets priced in dollars more expensive to buyers in other currencies. Front-month December oil had been struggling to stay above the psychologically important level of $40 a barrel. “Oil hasn’t fallen below $40 [a barrel] unless there’s some sort of economic crisis, so it’s important it stay above that,” Phil Flynn, senior market analyst at Price Futures Group, told MarketWatch. WTI ended with a weekly gain of 2.1%, while Brent posted a weekly advance of 2%, according to FactSet data. Meanwhile, ICE January Brent crude the international benchmark, rose 1.1% to end at $44.66/bbl. Flynn said that terror fears like last week’s Paris attacks and the hostage situation in a Mali hotel may also be factoring into oil’s moves. “If we’re going to see more terror attacks it’s going to eventually take its toil on the demand side of the equation,” Flynn said.
Earlier this week, the U.S. Energy Information Administration said domestic crude-oil inventories rose by 252,000 barrels last week, less than expected by the market. However, U.S. oil inventories remain near levels not seen for this time of year in at least the last 80 years. “Additional oil could reach the market from Iran in the course of the first quarter of 2016, thereby swelling the oversupply,” analysts at Commerzbank said in a note to clients. “We regard a quantity of 500,000 barrels per day as realistic, though this should already be priced in and thus pose no additional burden on prices.”
The week of Thanksgiving is expected to be slow for oil traders, and the following week investors are awaiting a meeting of the Organization of the Petroleum Exporting Countries on Dec. 4 in Vienna. Market participants don’t expect the oil cartel to decide to trim oil production meaningfully.