Fuels Market Watch 24

FUEL MARKETS TODAY – Market Overview

Over the past 24 hours, WTI (West Texas Intermediate) crude prices strengthened, giving a three-day upward trend that recouped most of last week’s losses. WTI prices in today’s trading session opened at $68.07/b, a leap of $1.99/b above Wednesday’s opening. Diesel and gasoline prices also opened with strong gains, with futures prices opening approximately 2% above prior day’s prices. The strong upward price movement has halted today.

Oil prices continued to rise yesterday. Prices moved up when official data on oil inventories from the Energy Information Administration (EIA) corroborated, for the most part, the data released earlier by the American Petroleum Institute (API.) The EIA reported that U.S. crude oil inventories were drawn down by 5.836 million barrels during the week ended August 17th. This exceeded the 5.17 million barrels predicted by the API. However, the EIA reported stock buildups for both diesel and gasoline. The EIA reported an inventory addition of 1.849 mmbbls of diesel, slightly higher than the 1.8 mmbbls expected by the API. Moreover, the EIA reported a stock buildup of 1.2 mmbbls of gasoline, counter to the 0.9 mmbbls stock draw anticipated by the API. The addition to refined product stockpiles was one reason why crude oil prices rose at a slightly higher rate than refined products yesterday.

Markets are edgy today. The U.S. political scene remains in disarray, with the potential for what some politicians are calling a coming “bloodbath” in mid-term elections. The U.S.-China trade war continues, with the current round of low-level talks having no impact on the implementation of 25% tariffs on approximately $16 billion worth of goods.