Yesterday WTI was off $1.88 to settle at $43.08/bbl which is the lowest settle price since March 2009. Brent Crude lost $1.23 to settle at $49.18/bbl to stay above the 2015 low of $46.59/bbl. These bearish crude numbers are stemming from oversupply but got a boost from the refinery issues in PADD II. BP’s Whiting, IN refinery went offline and could be up to a month, resulting in a loss of processing capacity of 240,000 bpd. There was also a turnaround with the hydrocracker at Marathon’s Robinson, IL refinery and some lingering problems at Wood River, IL, tightening the market.
The availability for physical product is tight right now, causing the purchase prices to be higher. Gasoline rack prices in the Ohio market are +0.40 to +0.68 over the RBOB settle, whereas, on Monday they were only +0.04 to +.0.10 over. The Chicago cash market was $0.75 over the RBOB settle on CBOB and $1.05 over the settle for RBOB.
In global news, the world’s largest importer of crude, China, has devalued its Yuan by 4% in just two days. This is yet another example of the hard economic times in this country. The U.S. Dollar has been off since this news and continues to weather.
Last night the API reported a draw in U.S. crude inventory by 847,000 barrels, which was much lower than expected. It was also reported there was a build of 117,000 barrels of gasoline and 2.16 million barrels of diesel. The DOE stats reported the U.S. crude inventory actually declined by 1.7 million barrels, resulting in a crude stock of 453,593 million barrels this year. Reports showed gasoline inventory was down 1.3 million barrels and distillates up 3.0 million barrels with refinery runs unchanged.