Fueling Strategy: Please fill as needed tonight – Be Safe

NYMEX Crude $ 45.38 UP $.1800
NY Harbor ULSD $1.4650 UP $.0150
NYMEX Gasoline $1.3067 UP $.0259

NEWS
Oil futures rebounded a bit on Thursday to settle with a modest gain as investors hunted for bargains after prices recently fell near a three-week low. The gains came a day after a U.S. government report Wednesday showed a hefty weekly increase in crude stockpiles, underscoring how accustomed to bad news the crude market has become. “Sentiment on the oil market already appears to be so negative that additional ‘negative news’ is needed to justify any further price fall,” analysts at Commerzbank wrote in a note to clients.

December West Texas Intermediate crude gained 18 cents, or 0.4%, to settle at $45.38 a barrel on the New York Mercantile Exchange Brent crude rose 23 cents, or 0.5%, to $48.08 a barrel on London’s ICE Futures exchange. Buying interest for oil returned after some recent declines, but the “rally is stalling amid a weaker euro due to talk of further stimulus in the eurozone,” said Matthew Smith, commodity analyst at ClipperData. European Central Bank President Mario Draghi hinted Thursday at more economic stimulus to come, weakening the euro which helped strengthen the U.S. dollar that put some pressure on dollar-denominated assets like oil.

The U.S. Energy Information Administration reported Wednesday that domestic crude-oil inventories expanded by a more-than-expected eight million barrels last week. Inventories in the U.S. remain near levels not seen for this time of year in at least 80 years, adding further pressure to the already oversupplied global market. But the EIA also reported declines in stocks of gasoline and distillates, which include diesel, and U.S. oil production stayed stable from the previous week at about 9.1 million barrels a day. “We see some pickup in demand from refineries so this increase in demand somewhat compensates the huge increase in [crude] supply,” said Ole Hansen, head of commodity strategy at Saxo Bank.

In other energy news Thursday, the EIA reported that U.S. supplies of natural gas rose 81 billion cubic feet for the week ended Oct. 16. That was less than the forecast of analysts polled by Platts for a climb of between 86 billion and 90 billion cubic feet. November natural gas initially held on to earlier gains in the wake of the data, before losing ground. It settled 1.8 cents, or 0.8%, lower at $2.386 per million British thermal units.

Meanwhile, a meeting between members and nonmembers of the Organization of the Petroleum Exporting Countries on Wednesday didn’t produce an agreement on oil-production cuts, but Venezuela has reportedly proposed that the group return to a previous policy of trying to fix oil prices. “The market is going to trade around $45 a barrel level, as this floor was already tested, and in longer term there could be a rebound, driven by technical factors,” Hansen said. But he added that there isn’t much evidence of the market balancing sooner than the end of next year given the reluctance of Russia and other countries to trim output.