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MarketWatch

Refined Products
2.24.2017

Recap: The oil market remained range bound on Thursday as it retraced some of Wednesday's earlier losses and traded within Tuesday's trading range.  The market immediately posted a low of $53.87 at the opening and traded higher in overnight trading.  The market rallied to a high of $54.94 following the release of the EIA's weekly petroleum stock report, which showed a draw in crude stocks of 564,000 barrels on the week compared with expectations for a 3.5 million barrel build.  Also, crude oil stocks held in Cushing, Oklahoma fell by 1.528 million barrels on the week.  However, the oil market erased its gains and traded back towards the $54.20 level and settled in a sideways trading pattern ahead of the close.  The April crude contract settled at $54.45, up 86 cents while the April Brent contract settled at $56.58, up 74 cents.  The product markets were also supported in light of the larger than expected draws reported in both distillate and gasoline stocks.  The heating oil market settled at $1.6567, up 2.71 cents and the RBOB market settled at $1.5286, up 1.53 cents.     

Fundamental NewsGenscape reported that crude oil stocks held in Cushing, Oklahoma in the week ending February 21st fell by 225,062 barrels on the week and by 198,354 barrels from February 17th to 64,985,136 barrels. 

Iran's Oil Minister, Bijan Zanganeh, said an increase in oil prices to more than $55/barrel was not in the interest of OPEC as it would lead to an increase in output by non-OPEC producers. 

OPEC's Secretary General, Mohammad Barkindo, said January data showed conformity from participating OPEC countries with output cuts had been above 90% and oil inventories will decline further this year. 

Nigeria's Finance Minister, Kemi Adeosun, said the country's oil production increased to 2.2 million bpd.  Last week, Nigeria's Vice President, Yemi Osinbajo, said the country's oil production was between 1.7 million and 1.8 million bpd. 

Nigeria's Qua Iboe crude exports is expected to load an average 221,667 bpd in April, down 115,430 bpd month on month from the March program, according to a preliminary loading program. 

Energy Transfer Partners said it expects to have every federal permit for the Rover Pipeline by Thursday.  It also stated that the Dakota Access Pipeline has received all federal authorizations necessary to complete its construction.  The pipeline is now 99% complete.

Gasoline stocks held in independent storage in the Amsterdam-Rotterdam-Antwerp hub in the week ending February 22nd fell by 4.29% on the week and by 10.14% on the year to 1.161 million tons.  Gasoil stocks fell by 3.8% on the week and by 12.26% on the year to 2.964 million tons. 

According to the International Enterprise Singapore, the country's residual fuels stocks in the week ending February 22nd increased by 2.587 million barrels to 26.647 million barrels on the week.  Singapore's light distillates stocks increased by 440,000 barrels to 13.201 million barrels while its middle distillates stocks fell by 1.119 million barrels to 12.587 million barrels on the week. 

China's General Administration of Customs reported that the country's exports of diesel fuel in January increased by 32.5% on the year to 960,000 tons.  Its gasoline exports in January increased by 1.3% on the year to 600,000 tons while its kerosene exports fell by 12.4% on the year to 820,000 tons.


Early Market Call - as of 9:00 AM EDT

WTI - Apr $54.03, down 42 cents   

RBOB - Mar $1.5031, down 2.61 cents  

HO - Mar $1.6383, down 1.82 cents   


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Natural Gas
2.24.2017

Thursday, February 23rd, saw the front-month NYMEX Natural Gas Futures Contracts open at $2.691, ten cents above Wednesday’s closing price of $2.592. After a steady decent in the first two hours of the morning, the contract rebounded to reach the intraday high of $2.691 immediately following the weekly storage publication. Prices then slipped to the intraday low of $2.597 by 1:20PM as forecasts for low demand persist. Trading within a three cent band for the remainder of the afternoon, Thursday closed higher at $2.617.

The EIA Natural Gas Storage Report published on Thursday showed an 89 BCF withdrawal from storage for the week ended February 17th – above the market estimate of 84 BCF. Total working gas in storage was reported as 2,356 BCF; 10.0% below this time last year and 7.1% above the five-year average.

This morning in Globex, WTI Crude was down 57 cents; Natural Gas was up three cents; Heating Oil was down two cents; and, Gasoline was down two cents.

New York basis values were lower for all seasons, whereas New England basis values were higher for the current winter season and lower for the summer months. Additionally, cash prices were lower in both regions.

 
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For access to Sprague’s full Natural Gas Market Watch Report including commentary not posted here, please send your request to natgas@spragueenergy.com or call 1-855-466-2842.

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