Hike in Inventory, No Hike in Interest Rates

By: Angela Agostinone / February 10, 2016

Yesterday was a BIG down day. WTI crude closed down $1.75/bbl to $27.94, RBOB closed down $0.0572/gal to $0.8989, and HO finished down $0.0715/gal to $0.9749. As of 1:00 p.m. ET today, refined products are recovering a bit, but crude is down again slightly. The API data report last night showed a build in crude inventories of 2.4 million barrels, 700,000 barrels of which are in Cushing, OK. The report showed distillates built by 1.7 million barrels and gasoline by 3.1 million barrels. 

The DOE statistics that were released at 10:30 a.m. today showed a draw in crude of 754,000 barrels; however Cushing still had a 523,000 barrel build. The DOEs showed a build in both distillates and gasoline by 1.3 million barrels.  Since the release, HO prices have been fluctuating but RBOB remains strong at +0.05/gal.

Federal Reserve Chair Janet Yellen spoke today about the expected rate hikes. Yellen said the Fed will hold off on raising interest rates for now.  With all the volatility in the market, they are not going to make the situation worse by raising rates.  The major concerns are China’s economy and the significant decline in oil prices.  On Yellen’s comments, the oil markets fell and the dollar rose. Yellen did mention that the U.S. labor market remains solid: the unemployment rate dropped to 4.9% in January due to the 150,000 jobs that were created.

With this news from the Fed, and the continuing talks about OPEC meetings to discuss production cuts, it will be interesting to see if we have found a floor.

 

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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.


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