Ten days after the most powerful hurricane to hit the state of Texas in a half a century, major refineries and ports eye the arduous task of coming back on-line and resuming full operations. As many major ports and ship channels resume restricted operations, WTI crude resumes its climb towards the next major resistance level of $52 for October delivery. Below is a table showing the status of major ports:
With Gulf Coast refinery demand for crude at highs in the near term, after the majority of refinery infrastructure having been preserved and relatively low damage to export facilities, and the spread between WTI crude and Brent crude reaching its widest level, $6 a barrel, in two years, goosing the export market as overseas traders hunt for competitively priced crude, we should see continued momentum to the upside in West Texas Intermediate over the next week or so. As of 12pm EST, WTI for October delivery is up $0.56 at $49.22. That puts crude oil up almost 8% over the last three and a half trading days.
Refined products are mixed with RBOB for October delivery down $0.0383 at $ 1.6603 and Ultra Low Sulfur Diesel for October delivery up $0.0067 at $1.7547. Even though traders are concerned about the most powerful Category 5, Hurricane Irma, heading towards the Caribbean and Florida, potentially heading for some offshore rigs, bearish data of ample supplies and Libya’s Sharara oilfield restarting after the lifting of a pipeline blockade, should re-enforce the $52 resistance level. For now, we await today’s APIs and tomorrow’s DOEs for a better pulse on the inventory disruption Harvey orchestrated. Hold on tight, the hurricane season hasn’t even hit its peak yet.