Enough is Enough

By: Daniel Guttman / April 20, 2017

The market fell yesterday afternoon after the split DOE statistics. Gasoline dropped to a three-week low after the steady rise in price.  We saw draws across the board except in gasoline, which built 1.9 million barrels; crude drew 1 million barrels and distillate drew 1.9 million barrels.  Crude runs rose 351,000 bpd, distillate fell 457,000 bpd to 4.177 million bpd, and gasoline is at 9.223 million bpd.  Yesterday, front month heating oil closed down $0.0406 to $1.5813/gal, front month RBOB closed $0.0520 to $1.6590/gal, and WTI Crude closed down $1.97 to $50.44/bbl.

With talks of production cuts, domestic refining capacity is 1 million bpd higher than last year at this time. We may see an oversupply because of the all-time high crude inventories in the U.S.  The United States has been preparing for the cuts that OPEC has been talking about in order to stabilize crude stocks worldwide. 

Also worth noting is the Shell and Motiva split, which has been scheduled for May 1st.  Between the two suppliers, three major refineries were run, along with many other properties around the United States.

Motiva Gains:

  • Saudi Aramco will keep the Motiva name
  • 603,000 bpd refinery in Port, Texas (largest in the United States)
  • 24 distribution terminals
  • License to sell Shell brand gasoline and diesel in Texas, parts of Mississippi River Valley, and Southeast and Mid-Atlantic markets

Shell Gains:

  • Owner of the two other refineries in Louisiana (472,700 bpd capacity)
  • 11 distribution terminals
  • Branded Shell stations in Florida, Louisiana and U.S. Northeast
  • $2.2 billion balancing payment from Aramco/Motiva

The market is creeping back up as of 10:35 a.m. ET; May HO is up 50 points to $1.5863/gal and May RBOB is up just over a penny to $1.6695/gal.

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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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