Fueling Strategy: Please partial fill ONLY tonight, Wednesday AM wholesale prices will fall 2 to 2.5 cents – Be Safe Tonight!
NYMEX Crude $ 48.23 UP $.1600
NY Harbor ULSD $1.7406 DN $.0021
NYMEX Gasoline $1.6563 UP $.0218
NEWS
Oil prices finished higher Tuesday, stretching gains into a second-consecutive session as the latest OPEC report that showed oil production from the cartel fell last month. Expectations for a hefty weekly rise in U.S. crude-oil supplies, however, limited the price rise for oil. Inventories likely jumped on the back of lower demand from refineries that shutdown output of petroleum products in the wake of Hurricane Harvey.
West Texas Intermediate crude oil for October delivery gained 16 cents, or 0.3%, to settle at $48.23 a barrel on the New York Mercantile Exchange, while Brent oil for November added 43 cents, or 0.8%, to $54.27 on ICE Futures Europe.
In a monthly report released Tuesday, the Organization of the Petroleum Exporting Countries said output in August fell by 79,000 barrels a day to 32.76 million, driven mainly by a decline in Libya, Gabon, Venezuela and Iraq. Production had been on the rise over the summer, raising concerns OPEC’s deal to cut output wasn’t working. Saudi Arabia—OPEC’s most influential member—has been debating whether to extend the cartel’s production accord after it expires in March 2018.
The report from OPEC also highlighted that production outside the group fell in August, driven by disruptions in the U.S. after Hurricane Harvey rampaged through the oil producing regions in Texas and Louisiana. It made landfall on the Texas coast on Aug. 25.
In a monthly report issued Tuesday, the Energy Information Administration said U.S. crude output in the Gulf of Mexico is estimated to have fallen by 70,000 barrels a day to 1.6 million barrels in August from a month earlier because of Harvey’s disruptions. The EIA also reduced its expectations for 2017 and 2018 total U.S. crude-oil production. But many refineries along the Gulf Coast were knocked offline by the hurricane, prompting a notable rise in crude stockpiles for the week ended Sept. 1, according to EIA data.
The EIA will issue an update, covering the week ended Sept. 8, on Wednesday morning. The American Petroleum Institute releases its own weekly inventory report late Tuesday. On average, analysts polled by S&P Global Platts expect the EIA to report a climb of 10.1 million barrels in crude supplies, along with declines in gasoline stocks of 4 million and distillate stocks of 300,000 barrels.
The market “will be paying greater attention than usual” to the inventory numbers, which will give “the clearest picture to date of the fundamental impact to the oil market from Hurricane Harvey,” said Robbie Fraser, commodity analyst at Schneider Electric, in a note.
Oil refineries suffering damage from Harvey are gradually ramping up activity to get back to full capacity. Hurricane Irma made landfall in Florida over the weekend but turned out to be less damaging than expected, which helped to lift oil prices Monday.
Have a great day,
Loren R. Bailey, President
Fuel Manager Services Inc.
Office: 479-846-2761
Cell: 479-790-5581