Fueling Strategy: Please “FUEL AS NEEDED” today/tonight, Thursday prices will drop less than one penny ~ Please Be Safe!

NMEX Crude      $ 72.56 UP $.1600

NYMEX ULSD     $2.6536 DN $.0070

NYMEX Gas       $2.1354 UP $.0135

NEWS

February WTI crude oil on Wednesday closed up +0.16 (+0.22%), and Feb RBOB gasoline closed up +1.35 (+0.64%). Crude oil and gasoline prices on Wednesday recovered from early losses and settled higher.  Better-than-expected U.S. economic news Wednesday signals strength in the economy that supports energy demand and crude prices.  Also, heightened geopolitical risks in the Middle East are bullish for crude as Houthi rebels continue to attack ships in the Red Sea off Yemen’s coast. Crude prices Wednesday initially moved lower and fell to a 1-week low after the dollar index climbed to a 1-month high.  Also, Wednesday’s selloff in global equity markets sparked a risk-off mood across asset markets.  In addition, weaker-than-expected economic news in China, the world’s second-largest crude consumer, is negative for energy demand and crude prices.

Wednesday’s U.S. economic news was better than expected and supported energy demand and crude prices.  Dec retail sales rose +0.6% m/m, stronger than expectations of +0.4% m/m.  Also, Dec manufacturing production rose +0.1% m/m, stronger than expectations of no change.  In addition, the Jan NAHB housing market index rose +7 to 44, stronger than expectations of 39.  By contrast, Wednesday’s economic news from China was bearish for energy demand and crude prices.  China’s Q4 GDP grew +5.2% y/y, slightly weaker than expectations of +5.3% y/y.  Also, China’s Dec retail sales eased to +7.4% y/y from +10.1% y/y in Nov, weaker than expectations of +8.0% y/y.  In addition, China’s Dec new home prices fell -0.45% m/m, the biggest decline in 8-3/4 years and the seventh consecutive month that home prices have fallen.

The recent series of hostile incidents in the Red Sea against commercial shipping is bullish for oil prices.  Last Friday, the U.S. Navy advised vessels to stay away from the southern Red Sea.  Houthis started attacking ships in the Red Sea in mid-November in support of Hamas in the Israeli-Hamas war and said they won’t stop the attacks until Israel ends its assault on Gaza.  Attacks on commercial shipping in the Red Sea by Iran-backed Houthi rebels have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.

An increase in Russian crude oil exports is bearish for crude oil prices.  Tanker-tracking data from Vortexa monitored by Bloomberg shows the four-week average of refined fuel shipments from Russia rose to 2.77 million bpd in the four weeks to Jan 14, up +53,000 bpd from the prior week.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

Fueling Strategy: Please “FUEL AS NEEDED” today/tonight ~ Please Be Safe!

NMEX Crude      $ 72.40 DN $.2800

NYMEX ULSD     $2.6606 DN $.0087

NYMEX Gas       $2.1219 UP $.0016

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

Fueling Strategy: Please “KEEP YOUR TANKS TOPPED” today/tonight, Saturday prices will go UP another 7.5 Cents ~ Be Safe

NMEX Crude      $ 72.68 UP $.6600

NYMEX ULSD     $2.6693 DN $.0045

NYMEX Gas       $2.1203 UP $.0060

NEWS

February WTI crude oil on Friday closed up +0.66 (+0.92%), and Feb RBOB gasoline  closed up +0.60 (+0.28%). Crude oil and gasoline prices Friday climbed to 2-week highs and settled moderately higher.  Crude prices rose on an escalation of geopolitical risks in the Middle East after the U.S. and its allies launched airstrikes against Houthi rebels in Yemen, retaliating for attacks on commercial ships in the Red Sea.   Late Thursday, President Biden said air strikes had been conducted against a number of targets in Yemen for attacking ships in the Red Sea.  In response, the Houthis said all U.S. and UK shipping interests are now legitimate targets for attacks. Crude prices fell back from their best levels after a recovery in the dollar sparked long liquidation in energy futures.

The increased number of hostile incidents in the Red Sea against commercial shipping is bullish for oil prices.  The Houthis started attacking ships in the Red Sea in mid-November in support of Hamas in the Israeli-Hamas war and said they won’t stop the attacks until Israel ends its assault on Gaza.  Attacks on commercial shipping in the Red Sea by Iran-backed Houthi rebels have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.  Crude oil prices have support from tighter global crude supplies after Libya’s National Oil Corporation on Sunday declared force majeure at its Sharara oil field that was shut down last Wednesday after protestors entered the facility.  The Sharara oil field is Libya’s largest and pumps about 300,000 bpd.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

Fueling Strategy: Please “PARTIAL FILL ONLY” today due to Friday wholesale prices will DROP 5 Cents ~ Be Safe

NMEX Crude      $ 72.02 UP $.6500

NYMEX ULSD     $2.6738 UP $.0732

NYMEX Gas       $2.1143 UP $.0470

NEWS

February WTI crude oil on Thursday closed up +0.65 (+0.91%), and Feb RBOB gasoline closed up +4.70 (+2.27%). Crude oil and gasoline prices Thursday settled moderately higher on an escalation of geopolitical risks in the Middle East after Iran seized an oil tanker in the Gulf of Oman.  

The increased number of hostile incidents in the Red Sea against commercial shipping is bullish for oil prices.  On Tuesday, the rebels launched one of their biggest attacks to date on commercial shipping lanes in the Red Sea as the U.S. Central Command said eighteen drones, two anti-ship cruise missiles, and one anti-ship ballistic missile were shot down by allied forces Tuesday in the Red Sea.  Attacks on commercial shipping in the Red Sea by Iran-backed Houthi rebels have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.  U.S. Secretary of State Blinkin on Tuesday said there would be “consequences” for the Houthis if they continued to assault ships.

Crude oil prices have support from tighter global crude supplies after Libya’s National Oil Corporation on Sunday declared force majeure at its Sharara oil field that was shut down last Wednesday after protestors entered the facility.  The Sharara oil field is Libya’s largest and pumps about 300,000 bpd.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

Fueling Strategy: Please “KEEP HAVE YOUR TANKS TOPPED” BEFORE 23:00 CST tonight, Prices are down 3 Cents BUT prices will go right back up Thursday 7.5 Cents~Be Safe

NMEX Crude      $ 71.37 DN $.8700

NYMEX ULSD     $2.6006 DN $.0498

NYMEX Gas       $2.0673 DN $.0095

NEWS

February WTI crude oil on Wednesday closed down -0.87 (-1.20%), and Feb RBOB gasoline  closed down -0.95 (-0.46%).

Crude oil and gasoline prices Wednesday erased an early rally and closed moderately lower.  Crude prices retreated after weekly EIA crude inventories unexpectedly rose, and gasoline and distillate supplies rose more than expected, indicating weak energy demand.  Crude prices Wednesday initially jumped after Houthi rebels carried out one of their largest missile and drone attacks on commercial shipping lanes in the Red Sea, potentially disrupting global crude supplies.

Crude prices Wednesday initially moved higher after Houthi rebels launched one of their biggest attacks to date on commercial shipping lanes in the Red Sea.  The U.S. Central Command said eighteen drones, two anti-ship cruise missiles, and one anti-ship ballistic missile were shot down by allied forces late Tuesday in the Red Sea.

Geopolitical risks in the Middle East have escalated and are bullish for crude prices.  Attacks on commercial shipping in the Red Sea by Iran-backed Houthi rebels have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.  U.S. Secretary of State Blinkin on Tuesday said there would be “consequences” for the Houthis if they continued to assault ships.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

Fueling Strategy: Please “FUEL AS NEEDED” today/tonight, Wednesday prices will go down 3 Cents BUT Thursday look for a 7.5 cent jump in prices~Be Safe

NMEX Crude      $ 72.24 UP $1.4700

NYMEX ULSD     $2.6504 UP $0.0735

NYMEX Gas       $2.0768 UP $0.0490

NEWS

February WTI crude oil on Tuesday closed up +1.47 (+2.08%), and Feb RBOB gasoline closed up +4.90 (+2.42%). Crude oil and gasoline prices on Tuesday posted moderate gains as they recovered about half of Monday’s sharp losses.  Supply disruptions to global crude supplies are underpinning oil prices as oil production at Libya’s Sharara oil field remains shut down after protesters stopped production there last week.  A reduction in Russian crude exports is also favorable for oil prices. Crude has support on tighter global crude supplies after Libya’s National Oil Corporation on Sunday declared force majeure at its Sharara oil field that was shut down last Wednesday after protestors entered the facility.  The Sharara oil field is Libya’s largest and pumps about 300,000 bpd.

A decrease in Russian crude oil exports is supportive of crude oil prices.  Tanker-tracking data from Vortexa monitored by Bloomberg shows the four-week average of refined fuel shipments from Russia fell to 3.34 million bpd in the four weeks to Jan 7, down -120,000 bpd from the prior week. A bearish factor for crude was Monday’s action by Saudi state producer Saudi Aramco to cut the official selling price of its Arab Light crude by -$2.00 to $1.50 above the benchmark for customers for February delivery, a larger cut than expectations of -$1.25 a barrel and the lowest in more than two years.

Geopolitical risks in the Middle East have escalated and are bullish for crude prices.  On Dec 30, the U.S. Navy sank three Houthi boats in the Red Sea after they fired on U.S. aircraft.  Also, Iran dispatched a warship into the Red Sea, increasing the risks of a direct U.S.-Iran military mishap.  The attacks on commercial shipping in the Red Sea have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.  At least thirty merchant ships have been attacked or approached around Yemen by Iranian-backed Houthi militants in the Red Sea since Israel’s war with Hamas broke out in October.

An increase in crude in floating storage is bearish for prices.  Monday’s weekly data from Vortexa showed that the amount of crude oil held worldwide on tankers that have been stationary for at least a week fell -2.1% w/w to 83.69 million bbl as of Jan 5. 

A bearish factor for crude was the announcement from Angola on Dec 21 that it is leaving OPEC amid a dispute over oil production quotas.  Angola is Africa’s second-largest crude producer, and the rift between Angola and other OPEC+ members is a bearish factor that signals infighting among members.  Other OPEC members may balk at Saudi Arabia’s attempt to force all members into a production cut. On Nov 30, OPEC+ agreed to cut crude production by -1.0 million bpd through June 2024.  However, crude prices sold off on the news since no details were provided on how the cuts would be distributed among members, nor how Russia’s -300,000 bpd export cut would factor into the new totals.  Delegates said the final details of the new accord, including national production levels, would be announced individually by each country rather than in the customary OPEC+ communique.  The market was disappointed that the extra cuts in OPEC crude output will be announced by each individual country, which suggests the reductions are only voluntary. Saudi Arabia said on Nov 30 that it would maintain its unilateral crude production cut of 1.0 million bpd through Q1-2024.  The move would maintain Saudi Arabia’s crude output at about 9 million bpd, the lowest level in three years.  Russia also said it will deepen its voluntary oil export cuts by 200,000 bpd to 500,000 bpd in Q1 of 2024.  OPEC Dec crude production fell -40,000 bpd to 28.050 million bpd.

The consensus is that Wednesday’s weekly EIA crude inventories will fall by -150,000 bbl. Last Thursday’s EIA report showed that (1) U.S. crude oil inventories as of Dec 29 were -2.3% below the seasonal 5-year average, (2) gasoline inventories were +1.8 above the seasonal 5-year average, and (3) distillate inventories were -4.1% below the 5-year seasonal average.  U.S. crude oil production in the week ended Dec 29 fell -0.8% w/w to 13.2 million bpd, falling back from the previous week’s record 13.3 million bpd.

Baker Hughes reported last Friday that active U.S. oil rigs in the week ended Jan 5 rose by +1 rig to 501 rigs, just above the 1-3/4 year low of 494 rigs from Nov 10.  The number of U.S. oil rigs in the past year has fallen from the 3-1/2 year high of 627 rigs posted in December 2022.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

National average price of gas projected to see yearly decline in 2024 for second straight year 

GasBuddy, a PDI company, today released its annual Fuel Price Outlook with some good news for drivers: expect lower gasoline and diesel prices in 2024. The outlook highlights key trends in gasoline and diesel prices, forecasting that, after two years of above average gas prices, 2024 will bring relief at the pump for consumers as several factors contribute to less of a pinch at the pump. GasBuddy expects the yearly national average will drop from $3.51 per gallon this year to $3.38 in 2024. 

Highlights from GasBuddy’s 2024 Fuel Outlook: 

• Gas prices still could fall below a national average of $3 per gallon this winter before potentially rising, getting close to $4 per gallon as summer approaches. 
• Drivers in some West Coast cities could again briefly see prices above $6 per gallon, although most major U.S. cities will see prices peak near $4 per gallon in 2024. 
• Americans are expected to spend a combined $446.9 billion on gasoline in 2024. Average yearly spending per household will fall to an estimated $2,407, down 2% from 2023, and over 12% from 2022. 
• Electric vehicles (EVs) and the 2024 presidential election have the potential to impact fuel prices in the year ahead, with a potential slowdown in the EV transition at stake. 
• Memorial Day will be the priciest 2024 holiday at the pump, with the national average price of gasoline expected to be $3.56-$4.04 per gallon on the holiday. 

“As 2023 fades away, I’m hopeful those $5 and $6 prices for gasoline and diesel will also fade into memory,” said Patrick De Haan, head of petroleum analysis for GasBuddy. “The global refining picture continues to improve, providing more capacity and peace of mind that record-setting prices will stay away from the pump in 2024. I anticipate that we’ll still have some volatility, unexpected outages and disruptions, and potentially weather-related issues, but I do not expect it to lead to record prices. Offsetting OPEC+’s production cuts is contributing to the rise of U.S. oil production, which now stands at record levels. Combined with Canada, North American oil production could further stabilize countries that have decided to curb oil production.” 

The outlook forecasts the highest prices will be seen at the peak of the summer driving season in May, with the national average potentially rising as high as $3.89 per gallon. More uncertainty is expected with hurricane season in late summer. Diesel prices are also predicted to fall incrementally from 2023, peaking at $4.13 per gallon in March 2024.  

Fueling Strategy: Please “FUEL AS NEEDED” today/tonight ~ Be Safe!

NMEX Crude      $ 70.77 DN $3.0400

NYMEX ULSD     $2.5769 DN $0.0316

NYMEX Gas       $2.0278 DN $0.0777

NEWS

February WTI crude oil on Monday closed down -3.04 (-4.12%), and Feb RBOB gasoline closed down -7.77 (-3.69%). Crude oil and gasoline prices on Monday sold off sharply, with gasoline falling to a 3-1/2 week low.   Concern that global oil demand is worsening is undercutting crude prices after Saudi Arabia cut the official selling prices for its crude for all customers.   Crude prices also fell on a report from ShippingWatch that said some shipping firms made a deal with Houthi rebels to get their vessels safely through the Red Sea, which could alleviate supply disruptions. Crude prices tumbled today after Saudi state producer Saudi Aramco cut the official selling price of its Arab Light crude by -$2.00 to $1.50 above the benchmark for customers for February delivery, a larger cut than expectations of -$1.25 a barrel and the lowest in more than two years.

A report today from Shipping Watch weighed on crude prices as the report said meetings between Houthi rebels and shipowners had taken place and that some safe passage accords had been agreed upon.  Such a pact would keep shippers from rerouting ship traffic around the Red Sea and alleviate supply disruptions of crude supplies.

Crude has support on tighter global crude supplies after Libya’s National Oil Corporation on Sunday declared force majeure at its Sharara oil field that was shut down last Wednesday after protestors entered the facility.  The Sharara oil field is Libya’s largest and pumps about 300,000 bpd.

Geopolitical risks in the Middle East have escalated and are bullish for crude prices.  On Dec 30, the U.S. Navy sank three Houthi boats in the Red Sea after they fired on U.S. aircraft.  Also, Iran dispatched a warship into the Red Sea, increasing the risks of a direct U.S.-Iran military mishap.  The attacks on commercial shipping in the Red Sea have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.  At least thirty merchant ships have been attacked or approached around Yemen by Iranian-backed Houthi militants in the Red Sea since Israel’s war with Hamas broke out in October.

An increase in crude in floating storage is bearish for prices.  Monday’s weekly data from Vortexa showed that the amount of crude oil held worldwide on tankers that have been stationary for at least a week fell -2.1% w/w to 83.69 million bbl as of Jan 5.

An increase in Russian crude oil exports is bearish for crude oil prices.  Tanker-tracking data from Vortexa monitored by Bloomberg shows the four-week average of refined fuel shipments from Russia climbed to 3.46 million bpd in the four weeks to Dec 31, up +230,000 bpd from the prior week and the highest since July. A bearish factor for crude was the announcement from Angola on Dec 21 that it is leaving OPEC amid a dispute over oil production quotas.  Angola is Africa’s second-largest crude producer, and the rift between Angola and other OPEC+ members is a bearish factor that signals infighting among members.  Other OPEC members may balk at Saudi Arabia’s attempt to force all members into a production cut.

On Nov 30, OPEC+ agreed to cut crude production by -1.0 million bpd through June 2024.  However, crude prices sold off on the news since no details were provided on how the cuts would be distributed among members, nor how Russia’s -300,000 bpd export cut would factor into the new totals.  Delegates said the final details of the new accord, including national production levels, would be announced individually by each country rather than in the customary OPEC+ communique.  The market was disappointed that the extra cuts in OPEC crude output will be announced by each individual country, which suggests the reductions are only voluntary. Saudi Arabia said on Nov 30 that it would maintain its unilateral crude production cut of 1.0 million bpd through Q1-2024.  The move would maintain Saudi Arabia’s crude output at about 9 million bpd, the lowest level in three years.  Russia also said it will deepen its voluntary oil export cuts by 200,000 bpd to 500,000 bpd in Q1 of 2024.  OPEC Dec crude production fell -40,000 bpd to 28.050 million bpd.

Last Thursday’s EIA report showed that (1) U.S. crude oil inventories as of Dec 29 were -2.3% below the seasonal 5-year average, (2) gasoline inventories were +1.8 above the seasonal 5-year average, and (3) distillate inventories were -4.1% below the 5-year seasonal average.  U.S. crude oil production in the week ended Dec 29 fell -0.8% w/w to 13.2 million bpd, falling back from the previous week’s record 13.3 million bpd.

Baker Hughes reported last Friday that active U.S. oil rigs in the week ended Jan 5 rose by +1 rig to 501 rigs, just above the 1-3/4 year low of 494 rigs from Nov 10.  The number of U.S. oil rigs in the past year has fallen from the 3-1/2 year high of 627 rigs posted in December 2022.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

Fueling Strategy: Please “FUEL AS NEEDED” today/tonight, Saturday prices will go down 2 Cents but will go right back up Sunday 2 Cents~Be Safe

NMEX Crude      $ 73.81 UP $1.6200

NYMEX ULSD     $2.6085 UP $0.0201

NYMEX Gas       $2.1055 DN $0.0046

NEWS

HOUSTON, Jan 5 (Reuters) – Oil prices rose on Friday as U.S. Secretary of State Antony Blinken began a week-long sweep through the Middle East in an attempt to contain regional tensions stoked by the Israel-Hamas conflict.

Brent crude futures settled up $1.17, or 1.51%, at $78.76 a barrel while U.S. West Texas Intermediate crude futures finished up $1.62, or 2.24%, at $73.81. Both benchmarks are on track to end the first week of the year higher, rebounding from losses on Thursday triggered by hefty increases in U.S. gasoline and distillate stocks.

“With the tensions in the Middle East, the geopolitical trading premium has to get pushed higher,” said John Kilduff, partner at Again Capital LLC. “It’s hard for traders to fight the headlines.”

Shipping giant Maersk said it will divert all vessels away from the Red Sea for the foreseeable future, warning customers of disruptions.

A U.S. government report showing employment grew in December would be supportive of demand in the coming year, Kilduff said. U.S. employers hired more workers than expected in December while raising wages at a solid clip, prompting financial markets to dial back expectations that the Federal Reserve would start cutting interest rates in March. Non-farm payrolls increased by 216,000 jobs last month, the Labor Department’s Bureau of Labor Statistics said. Economists polled by Reuters had forecast payrolls rising by 170,000 jobs. The economy added 2.7 million jobs in 2023, down sharply from the 4.8 million positions created in 2022. “Strong employment should point to strong demand for fuel,” Kilduff said.

The latest Fed meeting on Thursday gave a growing sense that inflation is under control and raised concern about the risks that an “overly restrictive” monetary policy may hold for the economy. 

Bank of America on Friday said it was taking a defensive stance towards oil stocks because of the long-term price forecast for oil. It said it expects the $70-$90 a barrel Brent trading range in place since OPEC+ intervened to hold, adding that “a permanently backward oil curve steepened by spare capacity” is a headwind for sector value. 

Oilfield services company Baker Hughes said the count of active drilling rigs – oil and natural gas rigs combined – fell by one last week to 621 for the third decline in four weeks. Crude oil drilling rigs were up by one at 501 while natural gas drilling rigs fell by two to 118.

Have a Great Day!

Loren R Bailey, President

Office: 479-846-2761

Cell: 479-790-5581

SCHEDULED OUT OF OFFICE  

None at this time

Tell Us How We’re Doing On Google Business

https://g.page/r/CUyL9wDolv04EAI/review

As always, thank you so much for being a part of the Fuel Manager Services, Inc. family, and we look forward to making this the best year yet!

“Celebrating 31-years of Service Excellence”

www.FuelManagerServices.com

“Coming Together is the Beginning; Keeping Together is Progress; Working Together is Success”  ~ Henry Ford

NMEX Crude      $ 72.19 UP $.5100

NYMEX ULSD     $2.5884 DN $.0160

NYMEX Gas       $2.1101 DN $.0480

NEWS

February WTI crude oil on Thursday closed down -0.51 (-0.70%), and Feb RBOB gasoline closed down -4.80 (-2.22%). Crude oil and gasoline prices Thursday gave up an early advance and turned lower weekly inventories of crude products unexpectedly rose in Thursday’s weekly EIA report, a sign of weak U.S. energy demand.  Crude prices Thursday initially moved higher due to supply disruptions in Libya and heightened geopolitical tensions in the Middle East.  Also, better-than-expected global economic reports Thursday were positive for energy demand and crude prices. Crude has support on tighter global crude supplies after Libya said Wednesday it was shutting down its Sharara oil field after protestors entered the facility.  The Sharara oil field is Libya’s largest and pumps about 300,000 bpd.

Thursday’s economic news was better than expected and supported energy demand and crude prices.  U.S. weekly initial unemployment claims fell -18,000 to a 2-1/2 month low of 202,000, showing a stronger labor market than expectations of 216,000.  Also, the U.S. Dec ADP employment change rose +164,000, showing a stronger labor market than expectations of +125,000 and the biggest increase in 4 months.  In addition, the China Dec Caixin services PMI rose +1.4 to a 5-month high of 52.9, stronger than expectations of 51.6.  Finally, the Eurozone S&P Dec composite PMI was revised upward by +0.6 to 47.6 from the previously reported 47.0.

Geopolitical risks in the Middle East have escalated and are bullish for crude prices.  On Sunday, the U.S. Navy sank three Houthi boats in the Red Sea after they fired on U.S. aircraft.  Also, Iran dispatched a warship into the Red Sea, increasing the risks of a direct U.S.-Iran military mishap.  The attacks on commercial shipping in the Red Sea have forced shippers to divert shipments around the southern tip of Africa instead of going through the Red Sea, disrupting global crude oil supplies.  At least thirty merchant ships have been attacked or approached around Yemen by Iranian-backed Houthi militants in the Red Sea since Israel’s war with Hamas broke out in October.

An increase in Russian crude oil exports is bearish for crude oil prices.  Tanker-tracking data from Vortexa monitored by Bloomberg shows the four-week average of refined fuel shipments from Russia climbed to 3.46 million bpd in the four weeks to Dec 31, up +230,000 bpd from the prior week and the highest since July. A decline in crude in floating storage is bullish for prices.  Monday’s weekly data from Vortexa showed that the amount of crude oil held worldwide on tankers that have been stationary for at least a week fell -16% w/w to 77.39 million bbl as of Dec 29.

A bearish factor for crude was the announcement from Angola on Dec 21 that it is leaving OPEC amid a dispute over oil production quotas.  Angola is Africa’s second-largest crude producer, and the rift between Angola and other OPEC+ members is a bearish factor that signals infighting among members.  Other OPEC members may balk at Saudi Arabia’s attempt to force all members into a production cut.

On Nov 30, OPEC+ agreed to cut crude production by -1.0 million bpd through June 2024.  However, crude prices sold off on the news since no details were provided on how the cuts would be distributed among members, nor how Russia’s -300,000 bpd export cut would factor into the new totals.  Delegates said the final details of the new accord, including national production levels, would be announced individually by each country rather than in the customary OPEC+ communique.  The market was disappointed that the extra cuts in OPEC crude output will be announced by each individual country, which suggests the reductions are only voluntary.

Saudi Arabia said on Nov 30 that it would maintain its unilateral crude production cut of 1.0 million bpd through Q1-2024.  The move would maintain Saudi Arabia’s crude output at about 9 million bpd, the lowest level in three years.  Russia also said it will deepen its voluntary oil export cuts by 200,000 bpd to 500,000 bpd in Q1 of 2024.  OPEC Dec crude production fell -40,000 bpd to 28.050 million bpd.

Thursday’s weekly EIA report was mixed for crude oil and its products.  On the bearish side, EIA gasoline supplies unexpectedly rose +10.9 million bbl to a 9-1/2 month high versus expectations of a -1.67 million bbl draw on weak demand as U.S. gasoline demand the week of Dec 29 fell -13.2% w/w to 7.954 million bpd, the least in nearly a year.  Also, EIA distillate stockpiles unexpectedly rose +10.09 million bbl to a nearly 2-year high versus expectations of a -1.1 million bbl draw.  In addition, crude supplies at Cushing, the delivery point of WTI futures, rose to +706,000 bbl.  On the bullish side, EIA crude inventories fell -5.5 million bbl, a bigger draw than expectations of -3.0 million bbl.  

Thursday’s EIA report showed that (1) U.S. crude oil inventories as of Dec 29 were -2.3% below the seasonal 5-year average, (2) gasoline inventories were +1.8 above the seasonal 5-year average, and (3) distillate inventories were -4.1% below the 5-year seasonal average.  U.S. crude oil production in the week ended Dec 29 fell -0.8% w/w to 13.2 million bpd, falling back from the previous week’s record 13.3 million bpd.

Baker Hughes reported last Friday that active U.S. oil rigs in the week ended Dec 29 rose by +2 rigs to 500 rigs, just above the 1-3/4 year low of 494 rigs from Nov 10.  The number of U.S. oil rigs in the past year has fallen from the 3-1/2 year high of 627 rigs posted in December 2022.

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