Morning Market Overview

Oil Futures Mixed on Supply Data, Ongoing Trade Concerns WASHINGTON, D.C. (DTN) —

Oil futures nearest delivery on the New York Mercantile Exchange and Brent crude on the Intercontinental Exchange are mixed following overnight trade, with West Texas Intermediate supported by a larger-than-expected drawdown in U.S. crude stockpiles, while upward momentum was capped by concerns surrounding the U.S.–China trade conflict. Near 9 AM ET, NYMEX June WTI futures were up $0.35 near $59.15 bbl, with ICE July Brent down $0.35 at $69.10 bbl, holding a roughly $1.50 premium to the August contract ahead of expiration Friday afternoon.

NYMEX June RBOB futures were down 1.75cts near $1.9275 gallon, trading at a better than 2cts premium to the July contract ahead of Friday’s expiration. NYMEX June ULSD futures edged down 0.3cts to $1.9645 gallon, with July deliver at near parity. WTI traded modestly higher in early hours Thursday after industry data showed a larger-than-projected 5.265 million bbl drawdown in U.S. commercial crude inventories for the week ended May 24, exceeding market expectations of 1.4 million bbl draw. American Petroleum Institute also reported gasoline inventories increased 2.711 million bbl versus an expected 800,000 bbl decline while distillate inventories dropped 2.144 million bbl, well above an expected 225,000 bbl drawdown.

Energy Information Administration is due to release supply data for the week ended May 24 at 11:00 AM ET, delayed due to Memorial Day. WTI was already boosted late Wednesday afternoon on news MPLX LP would restart the 360,000 bpd Ozark Pipeline, which carries crude from the Cushing storage facility to Wood River, Illinois. Weather-related pipeline outages and refinery shutdowns this week elevated the risk of bottling up crude supplies at the storage center.

Brent futures remained under pressure Thursday morning, as part of international commodity markets affected by China’s latest warning to cut off exports of rare-earth materials to the United States. Bloomberg reported the United States sourced nearly 80% of its rare-earth materials from China that are largely used for production of smartphones and electronics.

U.S. stock indexes futures were slightly higher Thursday morning, pointing to a mild recovery after Dow Jones Industrial Average fell 221.36 points on Wednesday following six consecutive weeks of declines. U.S. dollar traded higher Thursday morning at 98.035, holding below last week’s 98.26 two-year high. Liubov Georges, 1.646.359.4088, liubov.georges@dtn.com, www.dtn.com. (c) 2019 DTN. All rights reserved.