Broncos Are Off to Disneyland, While the “Bears” Stay in Town.

By: Daniel Guttman / February 8, 2016

As the Denver Broncos, with Peyton Manning at the helm and probably for the last time, gallop victoriously into the night after bullying the Panthers offense, we enter a new week of trading accompanied by several bearish sentiments:

  • Venezuelan oil Minister Eulogio Del Pino has been on tour trying to persuade top oil producers to take action in hopes of increasing the price of crude. Yesterday, no physical signs of an arrangement for OPEC and non-OPEC suppliers to formally discuss the global supply glut emerged from his meeting with Saudi Arabia’s oil minister, although he was quoted by Reuters saying that his meeting was “productive.”
  • With oil prices continuing to hover around the low $30/bbl range, top U.S. shale oil companies have yet again cut their budgets for 2016. That’s two budget cuts within the first two months of the year, with an average reduction of 40%—primarily affecting spending on new wells and projects.
    • Additionally, Baker Hughes reported on Friday the seventh straight weekly decline in the U.S. oil rig count, down 31 to 467. At this time last year there were 1140 active oil-drilling rigs domestically.
  • Even with headlines of a missile launch from North Korea (geopolitical news that would normally prop up the futures market), the market showed little-to-no response as the global oversupply remains the top market factor.
    • Interesting side note: recent analysis indicates that if every oil producer worldwide intended to help increase the value of a barrel of crude, it would only take a 2% total global supply cut to increase the barrel price by $30. Obviously, OPEC is more intent on keeping new production offline in the short term.

Driving enthusiasts, however, are “driving on cloud nine.” With regular gasoline prices on average 37 cents lower than a year ago, top independent refiners, such as Valero and Phillips66, are pumping out as much product as they can into a demand-driven marketplace. With reports provided by the E.I.A. showing prices at the pump expected to remain under $2/gal throughout 2016, it’s no wonder why drivers are putting on the miles and also buying bigger vehicles.  

In today’s market we see crude down $0.70 to $30.19, heating oil up $.0077 to $1.0667, and RBOB down $0.0117 to $0.9810. The heat strength is echoed by natural gas on news of cold weather coming to the Northeast this week.


Categories: Daily Market Update

Daniel Guttman

Written by

Daniel Guttman

With a background in wholesale and commercial sales as well as pipeline scheduling, Daniel is currently the Manager, Business Development in the Card Access Fuels department. He is tasked to find new and innovative solutions to increase sales opportunities for the sales team while managing and evaluating internal department processes. He assists with day to day personnel management, customer data analysis, as well as the daily Pacific Pride inventory and pricing direction.

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.


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