Energy Market Updates

After a brief cease fire between the US and Iran early this week, hostilities resumed pushing oil markets to fresh highs. Finished diesel and gasoline are now close to levels we saw in early March when the war started. What is interesting to point out, at these levels, one would think crude oil to be $125-$135 per barrel, but that’s not the case, it’s $85. A factor of US sourced product, making the ULSD crack spread (value of a gallon of crude compared to the value of a gallon of diesel) at over $90 per barrel, compared to roughly $55 to make gasoline. That will and has pushed refiners to produce more distillates recently, which are starting to show in weekly inventory numbers. How that tames finished pricing down the road still remains to be seen. Theory being, more inventory, lower demand, lower pricing. The caveat may be the steep backwardation from one month to the next preventing some from carrying inventory. While it may feel like your swimming on Cape Cod with a pack of seals, (love shark week) knowing your supplier is in your corner can be the lifejacket you need.

It has been yet another bizarre week in the fuel world, although we are relatively numb to the bizarre.  Almost two weeks after the removal of the former Venezuelan dictator, markets jumped roughly $.20 as focus shifted to the next crisis, Iran.   One would have thought we would see some additional downside or at least a calm period as the US tries to figure out its restructure plan for Venezuela.   

The trifecta of energy markets, Crude, Diesel, and Gasoline, typically march in lock step with one another. That is, the finished products like Diesel and Gasoline...

Once again we ended last week with a nice correction only to give it all back so far this week.  Again finding ourselves smack dab in the middle of the summer range.  Forward looking sentiment appears to have fully accepted we might be in for a bear run soon.  A start to an Israeli-Hamas peace deal looks to be on the horizon.  A mixed bag of Inventory data this week that is likely to be corrected due to the shutdown-Distillate demand strangely jumped almost 8% over last year.

Happy Tariff Day! Today is when higher tariff rates on most countries (except Mexico & China who are the two largest) supposably go into effect for goods coming into the...

Energy markets have wavered back and forth the last 10 days as folks try to figure out what the effects of the “Big Bill” will have on segments of the economy. One thing...

The situation is fluid. I believe that to be a perfectly acceptable answer for any question asked of me. “Dad, can I go to Italy after graduation?”…. The situation is...

Future pricing was moderating some until Tuesdays big jump, pushing Diesel futures to the higher end of the current range. The increase came as news that China was...

Fuel pricing had a nice correction going the last couple of weeks, both gasoline and diesel were down about $.15. That was put on pause yesterday as the focus shifted...

A week ago we mentioned that we might reset to a new low if the three key drivers fell in line. They did just that, for the most part. OPEC+ rolled production status,...