Fuels Market Watch 24
Exclusive daily fuels market analysis by Dr. Nancy Yamaguchi.
FUEL MARKETS TODAY – Market Overview
Crude oil futures prices are flattening this morning, working to stay above the $57/b level. WTI (West Texas Intermediate) crude forward prices opened at $56.76/b today, up by $0.69 (1.23%) from yesterday’s opening price of $56.07/b. Diesel futures prices opened fractionally lower today, while gasoline futures prices opened with gains. Futures prices appear to be gently declining this morning, awaiting market direction. This will include upcoming data from the American Petroleum Institute and the Energy Information Administration.
The Bureau of Labor Statistics (BLS) just released the February Consumer Price Index (CPI.) The CPI for all urban consumers increased by 0.2% on a seasonally adjusted basis. It was the first increase in four months. The CPI rose 1.5% for all items for the 12 months ending February. The index for all items excluding food and energy rose 0.1% in February, 2.1% for the year. The energy index rose by 0.4% in February, after dropping 3.1% in January. Over the last 12 months, the energy index dropped by 5.0%.
Markets appear to accept the idea that global oil supply and demand will be moving into balance. While U.S. crude production grows, supplies are being tightened by political turmoil, including sanctions on Iran and Venezuela. Venezuela continues to be divided, with two competing presidents: incumbent Nicolas Maduro, and National Assembly leader and interim president Juan Guaido. Venezuela is now in day 4 of electricity blackouts, which Maduro blames on a cyberattack by the U.S. The power outages have further constrained Venezuelan crude export, already crippled by U.S. sanctions. There are reports that the power outage has backed up a line of tankers at the Jose oil terminal.
Supply continues to be moderated by the OPEC+ group. Saudi Arabia already has cut production deeper than promised, cutting around 0.5 million barrels per day (mmbpd) rather than the 0.322 mmbpd specified in the agreement. Saudi Energy Minister Khalid al-Falih announced that the Saudis would cut production again in March and reduce exports to key customers. Mr. al-Falih also said that OPEC and partners could extend the cut agreement beyond the initial six-month period.
Gasoline opened on the NYMEX at $1.8251/gallon today, up by 2.75 cents (1.5%) from yesterday’s opening price of $1.7976 cents/gallon. Over the past 24 hours from 9AM EST to 9AM EST, gasoline prices increased by 0.59 cents (0.32%.) Gasoline forward prices have fallen off recent highs and currently are trading between $1.81-$1.83/gallon. The latest price is $1.8187/gallon.
Diesel opened on the NYMEX at $1.995/gallon today, down fractionally by 0.07 cents (0.03%) from yesterday’s opening price of $1.9957/gallon. Over the past 24 hours from 9AM EST to 9AM EST, diesel prices recovered slightly by 0.2 cents (0.1%.) Diesel prices have gently subsided, unable so far to regain the $2/gallon level. The latest price is $1.9929/gallon.
WEST TEXAS INTERMEDIATE
WTI (West Texas Intermediate) crude forward prices opened at $56.76/b today, up by $0.69 (1.23%) from yesterday’s opening price of $56.07/b. Over the past 24 hours from 9AM EST to 9AM EST, WTI crude prices rose by $0.93 (1.65%.) Currently, crude prices are working to stay in the territory above $57/b, trading in the range of $57.00-$57.25/b. The latest price is $57.17/b.