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Market Close: Sep 08 Down, Down, Down

Fueling Strategy: Please fuel as needed tonight, Wednesday please “partial fill only” due to prices will drop 7.5 cents Thursday AM, Be Safe
NYMEX Crude    $ 36.76 DN $3.0100
NYMEX ULSD     $1.0768 DN $0.0747
NYMEX Gas       $1.1028 DN $0.0744
NEWS
Oil prices tumbled to their lowest level since June on Tuesday amid growing demand concerns as Covid-19 continues to spread. WTI Crude the U.S. oil benchmark, slipped $3.01, or 7.6%, to settle at $36.76 per barrel. During the session WTI traded as low as $36.13, a price not seen since June 15. International benchmark Brent Crude dipped more than 5.3% to settle at $39.78, also its lowest level since June. “Today’s oil price move is a clear sign that the market now seriously worries about the future of oil demand,” said Paola Rodriguez-Masiu, senior oil markets analyst at Rystad Energy. “The streak of losses is driven by a stalling crude demand outlook for the rest of the year, with rising cases of Covid-19 and the end of the summer driving season in the U.S., as well as Asian refineries putting on [the] breaks,” she added.

Since WTI plunged into negative territory in April for the first time on record, oil prices have staged a big comeback. WTI jumped nearly 90% in May, and has posted monthly gains ever since. The gains were, of course, on the back of record lows, but prices moved higher as international producers scaled back production in an effort to counteract the demand drop-off caused by the pandemic. But in recent sessions prices have begun to trend lower. WTI fell during Monday’s session after registering a 7.45% loss in the prior week, snapping a four-week win streak and posting its worst weekly decline since June.

Tuesday’s move lower followed Saudi Aramco cutting its official selling prices for October, which RBC’s Helima Croft said triggered new demand concerns. In a recent note to clients, Bank of America said that it will take three years for demand to recover from Covid-19, assuming there’s a vaccine or cure. The firm believes peak oil will come as soon as 2030 due in part to electric car proliferation.

sRising U.S.-China trade tensions, as well as production coming back online also pressured prices on Tuesday, as did a stronger U.S Dollar. “The market has its eye on the big picture: where and when we see demand normalize globally and what happens with both US production and OPEC+ agreement over the medium term,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Management.

Have a Great Day,
Loren R Bailey, President
Fuel Manager Services Inc.
“Serving the trucking industry since 1992”
Office: 479-846-2761
Cell: 479-790-5581
www.FuelManagerServices.com
www.owneroperatoradvisoryservice.com
“To give real service you must add something which cannot be bought or measured with money, and that is sincerity and integrity.”
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.