Yesterday, WTI crude closed down $0.04 to $54.01/bbl, the April HO contract closed down $0.0084 to $1.6399/gal, and the April RBOB contract finished down $0.0123 to $1.7294/gal. March HO and RBOB contracts expired yesterday, and it is important to note the $0.2174 spread between the March ($1.5120) and April ($1.7294) RBOB settles because of the switch to the lower summer RVP grade which is more expensive.
The market was off across the board yesterday due to the statement from the Renewable Fuels Association (RFA) saying the obligation for blending biofuels will be moved from refiners to further down the supply chain at the rack level. This news caused RIN values to drop almost 25%. White House spokeswoman Kelly Love responded, “There is no ethanol executive order in the works.” Oil prices bounced before the market settled, in response to Love’s comment. Yesterday’s blog post covered more on this topic; if interested please click the link to read. http://blog.guttmanenergy.com/blend.-rins.-repeat-1.
After all this news during the day, the API statistics were released last night. The APIs showed crude had a build of 2.5 million barrels, of which 544,000 barrels was in Cushing, OK. Gasoline inventories built 1.8 million barrels, and distillate drew 3.7 million barrels. The market this morning is reflecting those statistics, with HO prices up and RBOB prices down. Another important piece of news today is that OPEC continued to cut production in February, and is now at 94% compliance.
Lastly, the DOE statistics were released today at 10:30 a.m. ET. The DOEs showed crude inventories had a build of 1.5 million barrels (495,000 barrels in Cushing, OK). Both refined products showed a draw in inventories: gasoline 546,000 barrels and distillates 925,000 barrels. As of 11:30 a.m. ET, WTI crude is up $0.05/bbl, HO is flat, and RBOB is down $0.0280.