Libya's Gain is Crude's Pain

By: Angela Agostinone / May 3, 2017

Yesterday, WTI crude closed down $1.18 to $47.66/bbl, RBOB closed down $0.0136 to $1.5136/gal, and HO finished down $0.0198 to $1.4680/gal. The WTI contract settled at a new six week low (see chart below). Weakness in the market was a result of news that Libya’s production is up to 760,000 barrels per day, which is the highest since the end of 2014. Production at the Sharara and El Feel oil fields could restart soon and help with Libya’s plan to reach 1.1 million barrels per day.  Also contributing to weaker prices yesterday were the continued uncertainty around OPEC’s decision whether to extend the production cut through the end of the year and rising production in the U.S.

wti six week low.png

The API statistics released Tuesday were bullish, and had oil prices rebounding last night into this morning.  The API statistics showed draws across the board. Crude inventories drew 4.2 million barrels, more than double of what was expected.  Gasoline inventories drew 1.9 million barrels, and distillates drew 436,000 barrels. Tamas Varga, an analyst at PVM Oil Associates, stated, “The API statistics are helping the market recover, but the underlying sentiment is still bearish.”  This proved to be true as the market slipped back down as it awaited the DOE statistics.

 

The DOE statistics released at 10:30 a.m. ET were a bit surprising and less bullish.  The stats showed a draw of only 930,000 barrels in crude inventories. Gasoline actually had a build of 191,000 barrels, and distillates had a draw of 562,000 barrels.  Demand for refined products is strong.  After the release of the DOEs, the market is relatively flat. As always, it will be interesting to see what new bullish news can influence the fundamentally bearish market.

 

5_2 settle-1.png


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.


Comments

Subscribe to our blog

Price Feed

Stay up-to-date on current fuel prices and market trends with our NYMEX price feed (15 minute delay to the live market).

© 2018 Market data provided and hosted by Barchart Market Data Solutions. Fundamental company data provided by Morningstar and Zacks Investment Research. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer.

Categories

Contact Us