Fuels Market Watch 24
Exclusive daily fuels market analysis by Dr. Nancy Yamaguchi.
FUEL MARKETS TODAY – Market Overview
Crude oil prices are moving down again this morning, weakened by unexpectedly large additions to inventories, and so far, at least, unperturbed by the turmoil of two presidents in Venezuela. WTI (West Texas Intermediate) crude forward prices opened at $52.45/b today, down by $0.50 (0.94%) from yesterday’s opening price of $52.95/b. Gasoline and diesel futures prices also opened lower today. Crude and product prices declined yesterday, and they continued to slide gently overnight. Markets are watching Venezuela today, wary of possible supply disruptions that could bring prices back.
The American Petroleum Institute (API) reported an unexpectedly large addition to inventories of crude oil, gasoline, and diesel for the week ended January 18th. The API reported an addition of 6.55 million barrels (mmbbls) to crude inventories, 3.64 mmbbls added to gasoline inventories, and 2.57 mmbbls added to diesel inventories. This totaled a major addition of 12.76 mmbbls to stockpiles. Market experts had expected a small drawdown in crude stocks, and smaller additions to product inventories. Prices dropped on the news. The Energy Information Administration (EIA) is scheduled to release official statistics later today.
U.S. refiners are stocking up on Venezuelan heavy crude, and if this continues, U.S. stockpiles could continue to grow. The turmoil of two Presidents in Venezuela could boost prices for these mainstay feedstocks. Yesterday, the Trump administration recognized the opposition leader Juan Guiado as the country’s interim President, stating that the re-election of Nicolas Maduro was illegitimate. President Maduro severed diplomatic relations with the U.S. and gave U.S. diplomatic personnel 72 hours to leave the country. The Trump administration has threatened to impose sanctions that could further hinder Venezuela’s already-limping oil industry. Venezuela’s oil production fell from 1911 thousand barrels per day (kbpd) in 2017 to 1339 kbpd in 2018. Incumbent President Maduro, however, still controls the state oil company and the military, so it is not clear whether a regime change is possible.
Gasoline opened on the NYMEX at $1.3834/gallon today, down by 2.27 cents (1.61%) from yesterday’s opening price of $1.4061 cents/gallon. Over the past 24 hours from 9AM EST to 9AM EST, gasoline prices fell by 1.93 cents (1.38%.) Prices currently appear to be stabilizing in the range of $1.38-$1.40/gallon. The latest price is $1.3876/gallon.
Diesel opened on the NYMEX at $1.8873/gallon today, down by 1.56 cents (0.81%) from yesterday’s opening price of $1.9029/gallon. Over the past 24 hours from 9AM EST to 9AM EST, diesel prices dropped by 4.4 cents (1.38%.) Diesel prices currently are volatile, with a general trend down, trading mainly in the range of $1.87-$1.89/gallon. The latest price is $1.8835/gallon.
WEST TEXAS INTERMEDIATE
WTI (West Texas Intermediate) crude forward prices opened at $52.45/b today, down by $0.50 (0.94%) from yesterday’s opening price of $52.95/b. Over the past 24 hours from 9AM EST to 9AM EST, WTI crude prices fell by $1.07 (2.01%.) Prices are trading up and down currently, but they have been remaining in the range of $52-$53/b. The latest price is $52.73/b.