Fuels Market Watch 24

FUEL MARKETS TODAY – Market Overview

Crude oil prices opened higher this morning, rising yesterday on news of U.S. sanctions on Venezuela. WTI (West Texas Intermediate) crude forward prices opened at $53.24/b today, up by $1.12 (2.15%) from yesterday’s opening price of $52.12/b. Gasoline and diesel futures prices opened higher also today, by 1.15% and 2.88% respectively.

The news of U.S. sanctions on Venezuela reversed most of the market losses that came on Monday, which came in tandem with a decline in stock markets. Oil prices have strengthened but not spiked, since Venezuelan turmoil has been an ongoing feature of the market, and oil supplies currently are ample. The American Petroleum Institute (API) reported a 2.1 million-barrel increase in crude inventories, plus a 2.2 million-barrel increase in gasoline stocks and a 0.211 million-barrel increase in diesel inventories. Official statistics will be released later today.

The Federal Open Market Committee (FOMC) will announce its latest decision this afternoon. Interest rates are likely to be held unchanged, and analysts await commentary on the general economic outlook. Some key statistics used by the Fed have not been available because of the federal government shutdown.

U.S.-China trade talks begin today in Washington, D.C., between China’s top trade emissary Liu He and U.S. Trade Representative Robert Lighthizer. The temporary truce on tariff escalation will end on March 1^st, so the countries have a month to reach agreement. The U.S. is pressing for structural reforms in Chinese trade policy, not merely an increase in Chinese purchases of U.S. goods (including oil.) The negotiations will have an added note of tension because of U.S. charges against Chinese telecommunications company Huawei.