Arrows Still Pointing Down

By: Angela Agostinone / January 6, 2016

The volatility in 2016 continues. The rally Monday from the conflict between Saudi Arabia and Iran did not last long, the market reversed and continues to seem bearish in the new year.  Yesterday, WTI crude closed down $0.79/bbl to $35.97, HO closed down $0.0011/gal to $1.1253, and RBOB finished down $0.0340/gal to $1.2567.  Currently, HO is down about $0.04/gal and RBOB is down over $0.07/gal.  Brent crude fell below $35/bbl for the first time since 2004. 

Normally, conflicts in the Middle East are perceived to be a bullish sign; however, the current issues between Saudi Arabia and Iran seem to be interpreted as reducing any chance of the OPEC members coming to an agreement on production cuts.  The large decrease in prices today is also a result of the stronger dollar and the bearish APIs reported last night and DOEs that followed today.  The API report showed a draw in crude of 5.6 million barrels, but there was a 1.4 million barrel build in Cushing, OK.  The APIs showed a large build for both refined products: 7.1 million barrels in gasoline and 5.6 million barrels in distillates. 

The DOE statistics report released at 10:30 AM showed shockingly large builds in refined products.  The DOE report for crude mirrored the APIs with a draw of 5 million barrels, and a 1 million barrel build in Cushing.  There was a build in gasoline of 10.5 million barrels, and a build in distillates of 6.3 million barrels.  Since this release, HO is down around $0.05/gal and RBOB is down almost $0.10/gal.  The week between Christmas and New Year’s usually have the largest builds of the year, as well as low demand, and this year was no different and much more extreme.  With the colder weather finally arriving, distillates will be quicker to recover than gasoline.

One last piece of news: North Korea seems to have tested a hydrogen bomb this morning.  An emergency meeting of the United Nations Security Council has been called to discuss North Korea.  There are many experts that are skeptical at this writing. 

1_5_settle


Categories: Daily Market Update


Angela Agostinone

Written by

Angela Agostinone

Angela manages daily price changes from suppliers to ensure Guttman Energy customers are getting the most current and competitive rack prices. She is also responsible for relaying supplier product allocations to Guttman Energy's sales and logistics team, as well as analyzing specific benchmarks such as OPIS, Platts, and Argus to ensure each customer is getting the greatest value from their contracted fuel purchases.


Guttman Energy Daily Market Update Disclaimer – The information contained in this market update is derived from sources believed to be reliable; however this update could include technical inaccuracies or typographical errors and Guttman Energy does not guarantee the accuracy, completeness or reliability of this update. FURTHERMORE, THIS UPDATE IS PROVIDED "AS IS," WHERE IS, WITH ALL FAULTS AND WITHOUT ANY WARRANTY OR CONDITION OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY. GUTTMAN ENERGY ALSO SPECIFICALLY DISCLAIMS ALL EXPRESS AND IMPLIED WARRANTIES. YOU USE THIS UPDATE AT YOUR SOLE RISK. This update and any view or comment expressed herein are provided for informational purposes only and should not be interpreted in any way as recommendation or inducement to buy or sell products, commodity futures or options contracts.


Comments

Subscribe to our blog

Price Feed

Stay up-to-date on current fuel prices and market trends with our NYMEX price feed (15 minute delay to the live market).

© 2018 Market data provided and hosted by Barchart Market Data Solutions. Fundamental company data provided by Morningstar and Zacks Investment Research. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer.

Categories

Contact Us