Fuels Market Watch 24

FUEL MARKETS TODAY – Market Overview

Oil prices continued to ease this morning, drifting below $74/b and currently hovering around $73.50/b. WTI (West Texas Intermediate) crude prices in today’s trading session opened at $74.40/b, down by $0.27 from Friday’s opening price of $74.67/b. Gasoline and diesel prices also opened lower today. Crude and product prices currently appear to be stabilizing after a round of profit-taking. 

After a steep midweek price climb last week, prices began to weaken on Thursday and Friday. First, the U.S. Energy Information Administration released data showing a major increase in U.S. crude inventories. Second, reports became public that Saudi Arabia and Russia had made plans in September to increase their production, with or without formal agreement from other OPEC and non-OPEC producing countries, and with U.S. knowledge. Now, this morning brings news that the U.S. will relax its stance on Iranian sanctions by allowing greater flexibility for countries importing Iranian crude. India, notably, will continue to purchase quantities of Iranian crude, though it has reduced the volumes. It appears likely that the U.S. will issue waivers to some allies, which will ease the constraint on supplies. 

In spite of the late-week downturn, WTI crude finished last week in the black, rising from $73.29/b on Monday to $74.34/b at the close of the market on Friday, a gain of $1.05 (1.4%.) The week ended October 5th was the fourth week in a row that WTI crude finished in the black. Over the past four weeks, WTI prices have risen by $6.52, rising from $67.82/b on Monday, September 10th to $74.34/b at the close of market on the 5th of October.  

Diesel also finished last week in the black, rising from $2.3531/gallon on Monday to $2.3923/gallon on Friday, an increase of 3.92 cents, or 1.7%. Over the past four weeks, diesel futures prices rose steeply by 17.03 cents/gallon. 

Gasoline alone ended last week slightly down, falling by 0.47 cents (0.2%) over the course of the week. Like crude and diesel, however, gasoline futures prices went up significantly when viewed over the past four weeks. Gasoline futures prices started on Monday, September 10th at $1.9749/gallon, and ended at $2.0861/gallon at the close of market on Friday, a gain of 11.12 cents/gallon.