Last week WTI was not able to hold above the $40/bbl mark as the December contract, now expired, closed at $38.99/bbl; the first time WTI closed below $40 since August. However, the current WTI contract for January is trading at $42.27 (+$0.37 on the day). Heating oil is currently trading at 1.3985, which is up $.0272, and RBOB is trading at $1.3163, also up $.0260. In the cash market we saw a week of decline as Chicago RBOB continued its downward trend, reaching levels below $1/gal, and closing Friday at $1.0404/gal. The cheapest gas in the country can be seen in Chicago and around the northern Midwest. New York, on the other hand, has seen very tight prices due to both lower production domestically and lackluster imports over the past month, which have kept retail prices high and tight while the Cash market has wavered a mere 8cts/gal in all of October.
Currently happening in, and/or impacting the petroleum world:
- U.S. has seen abnormally lower crude production, while Russia and Saudi Arabia have not cut production.
- According to Bloomberg, Mexico will receive a record payout of $6 billion from oil hedges this year.
- Terrorist attacks in Paris and Mali have surprisingly not discouraged stock market poise.
- The Fed has indicated a possible interest rate rise coming this December.
- Saudi Arabia has surpassed Russia as China’s top oil supplier.