Is 20 the New 30?

By: Angela Agostinone / January 13, 2016

WTI crude oil went below $30/bbl for the first time in 12 years yesterday, but closed barely above at $30.44. There has not been one up day for WTI crude yet in 2016. RBOB closed down $0.0282/gal to $1.0848 and HO closed down $0.0248/gal to $0.9901.  Yes, HO closed below $1/gal! 

As for the cash markets: Chicago, New York, and Gulf Coast for ULSD and HO all are well under $1 since Monday evening.  For CBOB and RBOB, Chicago and Gulf Coast closed right under $1 last night, but New York has yet to go that low.  There is a slight gain in the market since the APIs that were reported last night.  APIs showed a draw in crude of 3.9 million barrels, however refined products were bearish with a report of a 7 million barrel build in gasoline and 3.7 million build in distillates.  The DOE statistics did not mirror the APIs and since their release, the market has decreased for both RBOB and HO.  The DOE stats showed weak demand figures, a small build in crude of 234,000 barrels, and very large builds in gasoline and diesel, 8.4 million barrels and 6.1 million barrels respectively.



To get a sense of how far prices have dropped, consider that in 2014, taxes on diesel in the Pittsburgh market accounted for 20% of the wholesale cost of a gallon. Today, that number is 50%.  Taxes on gasoline made up 19% of the wholesale cost in 2014 and are now up to 43%. While tax increases contributed to this increase, it is mostly due to the steep decline in oil prices.  


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.

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