Fuels Market Watch 24

FUEL MARKETS TODAY – Market Overview

Oil prices remain strong today, though the upward momentum has slowed. WTI (West Texas Intermediate) crude forward prices opened at $48.30/b today, an increase of $1.40 (2.99%) from Friday’s opening price of $46.90/b. Gasoline and diesel forward prices also opened higher today. All are working to hold their gains this morning. Market optimism is strong today, with renewed talks between the U.S. and China on the trade war. The first day of negotiation looks promising, with the surprise appearance of Chinese Vice Premier Liu He heading what was expected to be a lower-ranking delegation.

Crude oil prices finished last week strongly in the black, breaking a three-week losing streak. WTI crude prices opened last Monday, December31st, at $45.22/b and closed on Friday, January 4^th, at $47.96/b, a significant gain of $2.74 (6.1%) for the week. Gasoline prices opened on Monday at $1.2929/gallon and closed on Friday at $1.3478/gallon, a gain of 5.49 cents/gallon (4.2%.) Diesel prices opened on Monday at $1.6539/gallon and closed Friday at $1.7692/gallon, a major gain of 11.53 cents/gallon (7.0%.)

On Friday, the Energy Information Administration (EIA) released U.S. weekly supply and demand data, delayed because of the New Year’s holiday. The EIA reported a minuscule addition of 0.007 mmbbls to crude inventories, but a major addition of 6.89 mmbbls to gasoline inventories, and a massive addition of 9.529 mmbbls to diesel inventories. This totaled a huge addition of 16.426 mmbbls to stockpiles. Prices declined only modestly, however, with commodities receiving broad support from steadying equity markets. Earlier, the American Petroleum Institute (API) had reported a drawdown of 4.457 mmbbls from crude oil inventories, an addition of 7.995 mmbbls to gasoline inventories, and an addition of 3.955 mmbbls to diesel inventories, for a total of 7.493 mmbbls added to stockpiles, another bearish set of data.