After opening the week yesterday with all three indices finishing down, the trend is continuing this morning as the board is lit red again for crude, RBOB and HO. Yesterday, crude finished down $0.0058 to close at $65.56 while RBOB and HO settled down by $0.0028 and $0.0312 to close at $1.9349 and $2.1048 respectively. Multiple factors contributed to yesterday’s decline including the strength of the U.S. dollar and most importantly, supply. Reports of rising U.S. production, increased rig counts and inventory expectations are all weighing heavily on the oil market. Later this afternoon, the American Petroleum Institute will publish their weekly stats followed by the Energy Information Administration’s all important report tomorrow morning.
With not much in the news currently, the markets await President Trump’s first State of the Union address in which he will discuss the economy, the country’s infrastructure and immigration. In addition to tonight’s address, the FOMC begins a two day meeting which is expected to conclude tomorrow without an interest rate hike. This meeting, which will be Chairman Janet Yellen’s last as Fed Chair, will lay the groundwork for three potential future interest rate hikes which the Fed has forecast for this year.
As of now crude is currently trading at $64.29 / barrel while RBOB and HO are both down approximately $0.0350.