Fuels Market Watch 24

Exclusive daily fuels market analysis by Dr. Nancy Yamaguchi.

FUEL MARKETS TODAY – Market Overview

Oil prices are trending up this morning, following year-end optimism in stock markets. WTI (West Texas Intermediate) crude forward prices opened at $45.22/b today, a small decline of $0.22 (0.48%) from Friday’s opening price of $45.22/b. Gasoline forward prices opened modestly higher in today’s session, while diesel prices opened lower. Prices for all three have strengthened in this morning’s early trading.

Stock markets have shown gains today, the last day of 2018. Investors are pinning hopes on progress in the U.S.-China trade war. U.S. President Donald Trump tweeted about a “very good” telephone call with Chinese President Xi Jinping, saying “Big progress being made.” China opened the doors to imports of U.S. rice for the first time, in what was meant as a gesture of good will.

Last week, crude oil and diesel finished in the red, while gasoline achieved a gain. WTI crude forward prices recovered from their midweek slump last week, and prices finished the week only slightly in the red. WTI prices opened on Monday at $45.45/b and ended on Friday at $45.33/b, a decline of $0.12 (0.3%.) Diesel forward prices dropped more severely, opening on Monday at $1.7517/gallon and closing the week at $1.6647/gallon, a loss of 6.96 cents (4.0%.) Gasoline forward prices opened on Monday at $1.3115/gallon and ended on Friday at $1.3262/gallon, an increase of 1.47 cents (1.1%.)

The U.S. Energy Information Administration (EIA) released official statistics on U.S. supply and demand on Friday, with data delayed by the Christmas holiday. For the week ended December 21st, the EIA reported a small drawdown of crude oil stocks, amounting to 0.046 million barrels (mmbbls.) Gasoline inventories rose by 3.003 mmbbls. Diesel inventories were essentially unchanged, edging up by 0.002 mmbbls. The net addition to inventories was 2.959 mmbbls. Oil prices, already weak, had been pressured even further on Wednesday when the American Petroleum Institute (API) reported a large Addition of 6.9 mmbbls to crude oil inventories. Market experts had predicted a drawdown of 2.869 mmbbls. The API also reported an addition of 3.7 mmbbls to gasoline inventories, and a drawdown of 0.598 mmbbls from diesel inventories. The API’s numbers added to a net inventory addition of over 10 million barrels. The EIA data did not paint a rosy picture, but it was less bearish than the API’s picture, and prices strengthened modestly.

GASOLINE

Gasoline opened on the NYMEX at $1.3285/gallon today, a small recovery of 0.42 cents (0.31%) from Friday’s opening price of $1.3243 cents/gallon. Over the past 24 hours from 9AM EST to 9AM EST, gasoline prices rose by 2.21 cents (1.67%.) Gasoline prices are trending up at present, though trading is thin. The latest price is $1.338/gallon.

 
DIESEL

Diesel opened on the NYMEX at $1.6983/gallon today, a decline of 4.28 cents (2.45%) from Friday’s opening price of $1.7411/gallon. Over the past 24 hours from 9AM EST to 9AM EST, diesel prices rose by 0.69 cents (0.41%.) Diesel prices currently have hit a small peak, and prices are retreating slightly in thin trading. The latest price is $1.689/gallon.

 
WEST TEXAS INTERMEDIATE

WTI (West Texas Intermediate) crude forward prices opened at $45.22/b today, a decline of $0.22 (0.48%) from Friday’s opening price of $45.44/b. Over the past 24 hours from 9AM EST to 9AM EST, WTI crude prices recovered by $0.53/b (1.17%.) WTI crude prices have strengthened today, so far managing to hold gains and remain above $45.50/b. The latest price is $45.67/b.