Fuels Market Watch 24

FUEL MARKETS TODAY – Market Overview

Crude oil prices opened strongly this morning, having breached the $71/b level. WTI (West Texas Intermediate) crude prices in today’s trading session opened at $71.14/b, up by $0.94 from Friday’s opening. Like crude oil, gasoline prices opened higher this morning, while diesel prices opened today slightly down. The oil complex as a whole showed an early morning run-up, now leveling off at a higher baseline level.

The oil complex finished last week comfortably in the black, despite a midweek rise and fall. WTI crude opened last Monday the 17th at $68.93/b, and the market closed at $70.58/b on Friday, for a weekly gain of $1.85 (2.7%.) Diesel futures prices opened Monday at $2.2122/gallon, and they closed on Friday at $2.226/gallon, a weekly gain of 1.38 cents/gallon (0.6%.) Gasoline prices opened on Monday at $1.9699/gallon, and prices closed at $2.071/gallon on Friday, a strong gain of 4.72 cents/gallon (2.4%.)

As expected, this weekend’s meeting in Algiers between OPEC and non-OPEC energy ministers brought no formal change to the oil production agreement. Saudi Arabia’s Energy Minister stated that his country could ramp up production by 1.5 million barrels per day if needed, but that “the markets are adequately supplied.” President Trump has been exhorting OPEC to bring prices down. The OPEC and non-OPEC producers group noted that it is looking toward the year 2019, and there was a consensus that supply and demand would be in balance, without using any spare production capacity. But the markets were not wholly mollified by these assurances. Prices are strengthening, since it is easier to see a greater upside potential than downside potential.