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Market Close: Oct 11 Up

Fueling Strategy: Keep tanks topped tonight, Thursday AM wholesale prices will jump UP 3 cents – Be Safe Tonight
NYMEX Crude        $  51.30 UP $.3800
NY Harbor ULSD    $1.7861 UP $.0221
NYMEX Gasoline   $1.6092 UP $.0177
NEWS

Oil prices logged a third straight session gain, as OPEC raised its forecast for crude demand but said output by member countries rose in September despite a deal to limit production.

November West Texas Intermediate crude rose 38 cents, or 0.8%, to settle at $51.30 a barrel on the New York Mercantile Exchange. Brent crude, the global benchmark, for December delivery on ICE Futures Europe exchange climbed by 33 cents, or 0.6%, to $56.94 a barrel.

In its monthly report, the Organization of the Petroleum Exporting Countries said crude-oil production last month jumped by 90,000 barrels a day, complicating efforts by the cartel and other major producers to limit output and curb the global supply glut. OPEC also noted an increase of 31,000 barrels a day in output by nonOPEC countries in September, driven partly by a rise in U.S. production. The cartel, however, raised its forecast for growth in global demand for oil by around 30,000 barrels a day for this year and 2018. It now sees demand increasing by 1.5 million barrels a day in 2017 and 1.4 million barrels a day next year . “OPEC rhetoric continues to come in on the supportive side, with the cartel recently raising demand expectations,” said Robbie Fraser, commodity analyst at Schneider Electric. “Overall demand growth has consistently forced slight upward revisions of late as non-OECD Asia continues to lead global growth.”

Meanwhile, the U.S. Energy Information Administration lifted its crude-oil price forecasts for this year and next and increased its U.S. production outlook for 2018 by 0.8% to 9.92 million barrels a day, according to a report released Wednesday. But Jay Hatfield, president of InfraCap and portfolio manager of its MLP ETF said he expects U.S. production to gradually increase to about 10 million barrels a day during 2018. That’s what would be “required to keep supply and demand in balance as global demand for oil increases as global economic growth continues to expand.” “Forecasts of expanding U.S. and OPEC production are not bearish as expansion is needed to meet increased demand,” he said. Analysts at consulting firm JBC Energy pointed out that with WTI crude still trading at a significant discount to Brent, U.S. grades are a likely substitute, which “could therefore help U.S. crude find a firmer foothold in other markets, especially Asia.”

Late Wednesday, the market will get a weekly update on U.S. petroleum supplies from trade group the American Petroleum Institute. The government data from the EIA will be released Thursday morning. The reports were delayed by a day this week because of the Columbus Day holiday. Analysts polled by S&P Global Platts expect the EIA to report a drawdown of 400,000 barrels in crude stockpiles. They also forecast declines of 1.4 million barrels in gasoline supplies and 1.64 million barrels in distillate stocks.

 

Have a great day,

Loren R. Bailey, President
Fuel Manager Services Inc

Office: 479-846-2761
Cell: 479-790-5581

Categories: Fuel News
loren: Fuel Manager Services Inc. "Serving the trucking industry since 1992" I've been in and around the trucking industry for 45-years beginning in owner operator operations at Willis Shaw Express. I bought a small trucking company that I ran for 6-years then sold and went to work for J.B. Hunt Transport in 1982. After 10-years with Hunt, I started Fuel Manager Services, Inc., we are in our 29th year of serving the American trucking companies. Our simple goal was and is to bridge the gap between the trucking companies and the fuel suppliers.