Prices are volatile again today after yesterday’s surprise strong performance. As of 10:50 am, distillates were down .0135, gas was down .0216 and WTI was near even.
As of 12:12 pm, distillates are now up .0264, gas is up .0115 and WTI Crude is up around 1 dollar respectively.
Yesterday’s DOE report of continued crude builds supports the already familiar supply glut discussion. According to lead oil analyst at PVM Oil Tamas Varga, the most recent reported draw on gas inventories may have helped future prices remain stable for the time being. He inferred that it is not likely going to stay this way, especially since the U.S. is “flooded with oil.”
Another case for why we are experiencing recent gains, could be the weakening of the U.S. Dollar. Since the latter half of July, the dollar has weakened 2 percent.
As of now, it’s hard to pin point the direction of the market. Will the supply glut take us down to $35 or will a U.S. economy with budding momentum lend a helping hand to bring prices back near $45-$50?
What else is in the news?
- Iraqi crude oil output climbs 73,000 bpd in July to 4.632 mbpd
- China decreased retail fuel prices for only the third time since January