Crude prices are hovering around $46 per barrel (/b) today. The trading session opened with West Texas Intermediate (WTI) crude at $45.95/b, but prices are trending up. Gasoline prices opened with futures contracts at $1.9148/gallon, up by nearly 5.5% above yesterday’s opening value. They have ranged from $1.9121/gallon – $2.0086/gallon. Gasoline futures have not touched the $2/gallon level since July 13, 2015.

Tropical Storm Harvey is moving inland in a northeasterly direction. Heavy rains are expected in Tennessee, and along the storm’s path perhaps as far as Ohio. Although rains have eased, the Gulf Coast region remains locked in battle against severe flooding.

Key refineries and pipelines are closed or running at reduced capacity. Bloomberg reported that 4.3 million barrels per day (MMbpd) of U.S. refining capacity (of a total 18.6 MMbpd) is offline. Traders have chartered 20 product tankers to ship European fuel to the Americas, capitalizing on the upsurge in prices. The tankers may also head to Mexico, which imports significant volumes of fuel, including massive volumes from the United States. According to the U.S. Energy Information Administration (EIA), Mexico imported 329 thousand barrels per day (kbpd) of gasoline from the U.S. in calendar year 2016. Imports rose to an average of 340.2 kbpd during the January – May 2017 period.

The EIA released official weekly supply data for the week ended August 25. The data were bullish for prices. Crude inventories were drawn down by 5.392 million barrels (MMbbl), very close to the earlier prediction of 5.78 MMbbls by the American Petroleum Institute (API). The EIA also reported an addition of 0.748 MMbbls to distillate inventories and a very small addition of 0.035 MMbbls to gasoline inventories. The API had reportedly anticipated a gasoline stock build of 0.476 MMbbls.

The EIA also reported that domestic crude production rose slightly by 2 kbpd during the week ended August 25. Production averaged 9,530 kbpd. Production is expected to drop in next week’s data series, showing the impact of Hurricane Harvey.

In the week that led to Harvey, U.S. refineries processed a net of 17,725 kbpd of crude, up by 264 kbpd from the week prior. Apparent domestic demand for the week rose significantly, including an increase of 217 kbpd of gasoline demand and an increase of 289 kbpd of jet fuel demand. Diesel demand was down by 167 kbpd during the week.

WTI crude opened at $45.95/b this session, a drop of 36 cents from yesterday’s opening. WTI has not opened below the $46/b level since July 24. Currently this morning, WTI prices are $46.08/b, up by 13 cents since today’s opening. The daily price range has been $45.58/b – $46.33/b.