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Market Intel Archives

Oil markets not overly impacted with additional Russian sanctions

April 29, 2014

Recap: Oil markets did not reflect concern yesterday that new rounds of sanctions from the U.S. and E.U. would interrupt oil flows as oil futures contracts closed mostly down. ICE Brent Crude moved down a robust $1.46 to settle at 108.12, while June NYMEX (WTI) Crude gained slightly 24 cents to 100.84, hanging onto a level above $100 after seeing a low of 100.33. July NYMEX Crude also settled above $100 at 100.11 but dipped to 99.63 during intraday trading. The products saw a steady sell-off ahead of their expiration tomorrow, with the May NYMEX ULSD (HO) settling down 3.47 cents to 2.9519. The incoming June ULSD futures contract fell more, 3.64 cents to 2.9445. May NYMEX RBOB (Gasoline) fell 3.48 cents to 3.0403, while June RBOB settled down 4.02 cents to 2.9864. This puts RBOB's May-June backwardation at 5.39 cents. Currently: Oil markets are currently all up. NYMEX ULSD is up 1.14 cents to 2.9633, NYMEX RBOB is up 95 points to 3.0498, NYMEX Crude is up 64 cents tbeo 101.48, and ICE Brent is up 52 cents to 108.64. 

New Sanctions on Russia:  Yesterday, the U.S. imposed new sanctions on Russia that included 17 companies and 7 Russian government officials that all have close links to President Putin. As reported by the Associated Press, "Among the targets of the new sanctions is Igor Sechin, the president of state oil company Rosneft, who has worked for Putin since the early 1990s. Sechin was seen as the mastermind behind the 2003 legal assault on private oil company Yukos and its founder Mikhail Khodorkovsky, who at the time was Russia's richest man. The most lucrative parts of Yukos were taken over by Rosneft, making it Russia's largest company." The European Union added 15 more officials to its Russian sanctions' list, increasing the total now to 48. "The EU is Russia's biggest trading partner, giving it greater economic leverage over Moscow than the U.S. However, the EU treads more carefully in imposing sanctions since Russia is also one its biggest oil and gas suppliers --- and the bloc apparently shied away from following Washington's lead in targeting specific Russian companies." (AP) With traditional sources of oil in the Middle East and new sources in North America, the market may be less reactive than it could be to these geo-political headlines. Perhaps preparations are under way to mitigate Europe's need for Russian oil: Legislation to allow for export of US crude oil is moving forward, exports of U.S. petroleum products has been steadily increasing (see the EIA's info graphic chart showing U.S. product export flows below), and the U.S. government has been making test sales out of the Strategic Petroleum Reserve (SPR). As one can see from the chart, PADD 1 (East Coast) and PADD 3 (Gulf Coast) export distillate and propane to Europe. As we saw this past season, tight distillate and propane stocks, specifically in PADD 1, prevailed. Let's hope that in our effort to assist our European neighbors that we fix the outdated Jones Act that hinders domestic distillate products from making their way to the East Coast. 

DOE Inventory Estimates:  Oil markets will also be closely watching this week's DOE Inventory Report results. CitiFutures is expecting the following increase (build) or decrease (draw) ranges for the following: 2 to 3 MMb build for crude stocks, Unchanged to 1 MMb draw for gasoline, Unchanged to a 1 MMb build range for distillates, and a .5 percentage point increase in refinery % operable utilization to 91.5%. The 5-year average for this period is a 4.6 MMb build for crude, a 2.5 MMb draw for gasoline, and a .1 MMb increase in distillates.  The American Petroleum Institute (API) will release its inventory data this afternoon. The EIA will report its weekly DOE Inventory Report on Wednesday at 10:30am. 

See you at AREE - Atlantic Region Energy Expo!  We look forward to seeing you today through Thursday in Atlantic City. Please visit the Sprague team at our hospitality suite tonight from 6-9pm at Revel Hotel, Ocean F-G Room. Wednesday through Thursday, we will be at the Convention Center, Booth #716.  MarketWatch will return on Friday, May 2nd.

Click here to view today's Refined Products MarketWatch.

Oil markets mixed ahead of Wednesday's product expirations

April 28, 2014

Recap:  Oil markets all closed lower on Friday, with Brent ICE Crude losing the least, supported by on-going Ukraine-Russian headlines. Perhaps the most significant headline that could reverse upward momentum in petroleum markets was the record U.S. crude oil inventories released by the Energy Information Agency last Wednesday. And Friday, it appeared as if we saw oil markets pull back from geo-political headlines for the moment and focus on the abundant North American crude supplies, as traders locked in profits ahead of the weekend. ICE Brent Crude lost 75 cents to settle at 109.58 while NYMEX Crude (WTI) flirted closer to the $100 level, but closed down $1.34 to 100.60. On the products side, NYMEX ULSD (HO) closed below the $3 level to 2.9866, down 2.79 cents, and  NYMEX RBOB (Gasoline) closed down 1.44 cents to 3.0751. 

Currently, oil markets are mixed with NYMEX RBOB down 25 points to 3.0726, and NYMEX ULSD up 9 points to 2.9875. The crudes are both up, with NYMEX  Crude up 52 cents to 101.12, and ICE Brent up 23 cents to 109.81.

More Sanctions on Russia? Yesterday, President Obama announced new targeted sanctions that include Russian high-technology defense exports along with more "wealthy individuals close to Putin." (Reuters) U.S. officials will release a more detailed list today. However, Dow Jones Newswires is reporting this morning that Iran held talks with Russia over the weekend for electricity deals valued at over $10 Billion that include construction of hydroelectric power plants.  "Moscow is also in talks with Tehran to barter 500,000 barrels a day of Iranian oil for Russian goods. The deal, worth  as much as $20 billion, has rattled Washington because it could bring Iran's crude exports above a one-million barrels-a-day threshold agreed in the nuclear deal." (Dow Jones Newswires) If appearances are worth anything, it seems that Russia is preparing for economic sanctions from the West.

All Eyes on Wednesday: On Wednesday, April 30th, both the May futures' contracts for NYMEX ULSD and RBOB will be expiring along with the release of the EIA's weekly DOE Inventory Report, adding some more volatility this week. Additionally, first quarter U.S. gross domestic product (GDP) numbers (with Barron's believing the "number [has] an all-purpose, get-out-of-jail-free card" if it is weak due to severe winter weather) followed by the Federal Open Market Committee's (FOMC) policy decision to continue slowing quantitative easing by another $10 Billion per month (from the current $55 Billion). Traders will also be watching global equity markets for signs of weakness seen on Friday as the result of Standard and Poor's reducing Russia's credit rating to BBB-, a step above junk bond status. 

Speculative "Spec" Watch in brief: The CFTC reported on Friday that through April 22nd, net speculative length for NYMEX (WTI) Crude decreased 2% to 333,791 futures and options contracts. NYMEX ULSD net speculative length increased to a six week high of 32,987 contracts, an increase of 2/3rds since the previous report. Net speculative length also increased for NYMEX RBOB, up 6% to 92,129 futures and options.

Click here to view today's Refined Products MarketWatch.

Oil markets lower today as global stock markets move lower

April 25, 2014

Recap:  Oil markets moved higher except for the May NYMEX RBOB contract that settled close to even, down 4 points to 3.0895, while the June RBOB contract finished up 48 points to 3.0452, narrowing the May to June backwardation to 4.43 cents. ICE Brent moved to a high of 110.65 yesterday as reports of Ukraine launching an operation to drive pro-Russian insurgents out of buildings they occupied.  Acting Ukrainian President Turchinov called on Russia to retreat from the border as Russian President Putin warned the Kiev government of "consequences if it used the army against its own people." (Reuters)  Brent crude finished a bit lower off the high to 110.33, up $1.22. NYMEX ULSD (HO) seemed to move up with ICE Brent yesterday, finishing up 3.36 cents to 3.0145, close to its high on the day. NYMEX (WTI) Crude did not move as strongly as Brent, and even with an 80+ year record of commercial crude stocks, managed to finish up 50 cents to 101.94. As we have seen since the onset of Crimea's annexation, Ukraine-Russian tension headlines appear to be escalating to conflict headlines. 

Currently, oil markets are down along with global stock markets that have tumbled today. The AP reported that Standard & Poor's has reduced Russia's credit from a BBB credit rating to BBB-, "warning of capital flight and risks to investment due to the crisis." The Shanghai Composite Index dropped 1%, Seoul's Kospi dropped 1.3%, German DAX down .9%, French CAC-40 down .5%, and Russian Micex down .9%. U.S. markets will be influenced by the global downward trend and will most likely influence oil markets today. NYMEX ULSD (HO) is down 1.42 cents to 3.0003, NYMEX RBOB is down 1.41 cents, NYMEX Crude is down 58 cents and ICE Brent Crude is down 38 cents.


Weekend Weather and HDD Planning:  As we approach the end of April, the Frontier Weather 6-10 day outlook  is predicting colder-than-normal temperatures in the East (no surprise!).  Fax-Alert Weather Service confirms this view with their Ten-Day Temperature Guidance report for the period April 25 through May 4th.  And, yet again, Northeast locations are ALL colder than normal for this time of year! (HDD percentages above 100% indicate percentage increase of HDDs colder-than-normal temperatures): 

New York:  NYC 108%, Binghamton 121%, Albany 124%, Newburgh 117%

New Jersey:  Newark 116%, Trenton 112%

Pennsylvania:  Philly  126%

MassachusettsBoston 139%, Worcester 130%, Chicopee 155%, Hyannis 128%

Connecticut: Hartford 149%, Bridgeport 132%, New Haven 125%

NH: Manchester 125%, Portsmouth 127%, Lebanon 116%, Concord, 120%

Maine: Portland 127%, Augusta 115%, Bangor 112%

Vermont: Burlington 115%, Rutland 125%

Rhode Island:  Providence 134%

Have a great weekend and hope the sun is shining!!

Click here to view today's Refined Products MarketWatch.

Oil markets finished lower after release of DOE Inventory data

April 24, 2014

Recap:  Oil markets finished mildly lower yesterday after the release of the EIA's weekly DOE Inventory Report. Total commercial crude stocks increased yet again, 3.5 MMbs, but within expectations. Cushing crude stocks declined .8 MMbs, helping to mitigate the overall increase as NYMEX Crude (WTI) closed down 31 cents to 101.44.  NYMEX ULSD (HO) declined 2.17 cents to 2.9809 with results of a .6 MMb build creating  slightly bearish pricing versus expectations of a .3 MMb decline. Total gasoline stocks only declined .3 MMb upon expectations of a much larger decline of 1.9 MMb, and moved to an intraday low of 3.0606 before recovering to 3.0935, down only 17 points on the day. ICE Brent crude moved down to a 108.60 low before moving back up to settle at 109.11,  16 cents lower than the previous close. It appears that this 108.50 area is providing some support under Brent as traders are reluctant to sell with on-going tensions between Russian and Ukraine. Russia exports 4 MM barrels per day of crude oil and 1.5 MMbpd of products, and according to Tim Evans of CitiFutures, "any interruption in those export flows would certainly be a high impact event." Recall, the highest ICE Brent crude price since the annexation of Crimea is 111.42, and could be considered a benchmark price if additional sanctions impact these Russian exports. 

Currently, oil markets have recovered from their declines yesterday with NYMEX ULSD up 59 points to 2.9817, NYMEX RBOB up 91 points to 3.1026, NYMEX Crude up 34 cents to 101.78, and ICE Brent up 33 cents to 109.44. 

DOE Inventory Highlights:  Total commercial crude oil inventories increased 3.5MMbs to 397.7 MMbs, an 83-year high. Crude inventories have increased 13 of the past 14 weeks since January 10th, also around the time when the southern leg of the Keystone XL pipeline opened on January 22nd.  One would expect at some point, with these historic crude stocks, that NYMEX WTI prices should start to move lower. However, as mentioned in previous MarketWatch reports, the destocking of PADD 2's Cushing, OK storage center where the WTI contract is priced, continues. Cushing  inventories have now fallen 15.8 MMbs since January 22nd, and as result, has shrunk the premium of Gulf Coast Louisiana Light Sweet (LLS) Crude to a 68 cent premium over NYMEX WTI futures price from over $10 in mid-January. Why is this important? Well, at some point the shipping fee, estimated to be between $1.75 to $2.00 per barrel, will keep Cushing barrels from flowing if those costs cannot be recouped, as it currently appears, and Cushing tanks will start to build again. Hopefully, WTI prices will move lower. At some point, NYMEX WTI, will need to be considered the international crude benchmark, replacing Brent.

One stand out in yesterday's report was that refineries operated at 91% of their operable capacity for the week ending April 18th. Previously, refineries operated at 88.8% the week ending April 11th, and at 83.5% a year ago.  PADD 1 (East Coast) % operable capacity was lower at 84.6%, higher than last week at 79.2%, but lagging a year ago at 88.6%. Quietly, the Strategic Petroleum Reserve is moving lower 1.4 MMbs in the past 2 weeks as part of the "Test Sale."  Total distillate stocks stand 2.4% lower than last year, while PADD 1 is down 6.7% for the same period. Gasoline stocks are down 3.6% in total and also 3.6% lower in PADD 1. Robust refinery runs will hopefully keep enough products supplied for domestic use as driving demand increases.

Click here to view today's Refined Products MarketWatch.

Oil markets moving lower on DOE Inventory data

April 23, 2014

Recap:  Oil markets moved lower, capturing previous profits, except for the May NYMEX RBOB contract, which moved higher 83 points to settle at 3.0952. June RBOB declined 3 points to 3.0446, expanding the backwardation between May and June RBOB to 5.06 cents (3.0952-3.0446). As a premium in RBOB's front month of May continues to grow relative to the next outer June contract, the market is telling us that there is concern that perhaps gasoline supply is tightening. RBOB (Gasoline) basis for summer grade material  in New York Harbor has increased a penny since last week while ULSD basis has remained relatively flat. The seasonal transition from winter grade to summer grade RVP gasoline on the tail of refineries finishing up their turnarounds is to be expected, and confirmed with the robust increase in net speculative length last week. In addition to increasing gasoline prices, the harsh winter across the Mid-West and Northeast drained highway budgets and now drivers are left with roads and highways in disrepair with few local, state, and federal highway dollars to repair them.  NYMEX ULSD (HO) managed to stay above the $3 psychological level, but moved lower 91 points to 3.0026. The May NYMEX Crude futures contract expired yesterday at 102.13, down $2.24, as the June contract settled down $1.90 to 101.75, as on-going expectations of yet another larger crude build when the EIA's weekly DOE Inventory Report is released at 10:30am this morning.  

ICE Brent moved lower as well, down 68 cents to 109.27, despite a supportive news report from NBC News and Associated Press that in response to the Ukraine situation, the U.S. military will send 600 soldiers to several Baltic nations for training and exercises. "The first company of soldiers (members of the 173rd Airborne Brigade) will arrive in Poland on Wednesday, officials said.  Three additional company-size units will deploy to Estonia, Latvia and Lithuania for similar infantry training and exercises. They will be in place in all four countries over the next week."  Also reported yesterday was that Sweden's government has requested an  $830 Million increase in military spending to purchase 10 more fighter jets and 2 submarines as "it is deeply concerned by the recent events in Ukraine ... as both the left-leaning opposition and the government agree that the country's military readiness is inadequate." For Sweden to increase military spending along with U.S. military readiness in the Baltic region suggests that oil markets will be more reactive on these geo-political headlines.

Currently, oil markets are mixed ahead of the 10:30am release of the DOE Inventory Report this morning. NYMEX Crude is down 20 cents to 101.55, ICE Brent is up 11 cents to 109.38, NYMEX ULSD is up 4 points to 3.0030, and NYMEX RBOB is up 20 points to 3.0972. 

DOE Inventory Estimates:  CitiFutures is expecting the following increase (build) or decrease (draw) ranges for the following: 2.5 to 3.5  MMb build for crude stocks, 1 to 2 MMb draw for gasoline, a .5 draw to a .5 MMb build range for distillates, and a .5 percentage point decrease in refinery % operable utilization to 88.3%.  Bloomberg comes in with a crude build at 3 MMbs, a 1.9 MMb draw in gasoline, and a .3 MMb draw in distillate stocks. The 5-year average for this period is a 1.6 MMb build for crude, a 1 MMb draw for gasoline, and a .1 MMb decline in distillates.  The American Petroleum Institute (API) released its data Tuesday afternoon with the following results: a crude build of only .5 MMb (Cushing .8MMb draw), gasoline draw of 3.4 MMbs, and a distillate stock build of .6 MMb. Stay tuned for DOE inventory results at 10:30am!

Click here to view today's Refined Products MarketWatch.

Oil markets marginally up yesterday, NYMEX RBOB (Gasoline) strongest

April 22, 2014

Recap: Oil markets moved up yesterday with May NYMEX RBOB (Gasoline) moving the most, up 3.22 cents to 3.0869 as expectations are for more declines in the weekly DOE Inventory Report and "seasonal demand prospects attracting a cycle of speculative long accumulation" per Tim Evans of CitiFutures. (See Spec Watch below). The June RBOB contract settled at 3.0449, 4.2 cents lower than May, indicating a building backwardation, as the market perception that driving demand will outstrip current supply. Additionally, the EIA released its weekly Gasoline and Diesel Fuel Update revealing that the average U.S. regular gasoline price of $3.683 is up of 3.2 cents over last week, and 14.7 cents higher than last year at this time. PADD 1 (East Coast) prices are up more sharply than the national average, 5.3 cents cents higher than last week, and 18.2 cents higher than last year. The rest of the oil complex, including ICE Brent crude, is being supported on increasing tensions from pro-Russian insurgents in Ukraine. Today, Vice President Joe Biden is in Kiev, Ukraine to "demonstrate the U.S. commitment to Ukraine." According to a senior U.S. administration official on the requirements of anonymity, Biden "plans to announce new technical support to the Ukrainian government ... and to follow up on recent U.S. commitments of non-lethal security assistance." [AP] ICE Brent crude finished up 42 cents to settle at 109.95, and the May NYMEX Crude (WTI) futures contract finished up 7 cents despite expectations for another build of total crude oil stocks in this Wednesday's DOE Inventory Report. Today May NYMEX Crude expires, and the incoming June contract settled yesterday at 103.65, up 28 cents. NYMEX ULSD (HO) continues to hold above the $3.00 level, closing up 35 points to settle at 3.0117. The average U.S. on-highway diesel fuel price of $3.971 is 1.9 cents higher than last week and 8.4 cents higher than last year. Like gasoline, the average diesel fuel price in PADD of $4.070 is higher than the national average, 2 points higher than last week and 14.6 cents higher than last year at this time.

Currently, oil markets are down across the board with NYMEX ULSD down 47 points to 3.0070, NYMEX RBOB down 38 points to 3.0831, NYMEX Crude down 47 cents to 103.90 and ICE Brent crude down 51 cents to 109.44.

Speculative "Spec" Watch: The CFTC released its Commitments of Traders Report for the period ending Tuesday, April 15th and revealed that net speculative length increased across the oil complex: NYMEX Crude, ICE Brent, NYMEX ULSD and NYMEX RBOB. The largest increase in net speculative length was for RBOB that increased to a 52-week high of 73,525, 15,929 or 28% more futures and options contracts than the previous week. NYMEX ULSD's net speculative increase was 5,074 over last week, representing a 34% increase to 20,139 futures and options contracts. On the crudes, NYMEX WTI net spec length increased 3% to 341,477, and ICE Brent increased 4% to 133,029 contracts over last week. Again, the upward price action that we have seen since the beginning of April, particularly in RBOB from an April 1 settle of 2.8697 to yesterday's settle of 3.0869, represents a 21.72 cent increase! Let's hope we see a reversal in this trend.

Click here to view today's Refined Products MarketWatch.

Oil markets lower after weekly gain last week

April 21, 2014

Recap:  Oil markets were closed on Friday due to the Good Friday holiday. Thursday, April 17th settlements were as follows: NYMEX Crude 104.30, ICE Brent 109.53, NYMEX ULSD (HO) 3.0082, and  NYMEX RBOB 3.0547. In a week's time from April 11th to April 17th, weekly gains were seen in each of these four oil futures contracts. In terms of % increase, NYMEX ULSD (HO) was the biggest gainer, up 2.6% or 7.5 cents on the week, followed by ICE Brent, up 1.98% or $2.13. NYMEX RBOB's increase came in at 1.3%, or 4.03 cents, while NYMEX (WTI) Crude gain's were the weakest on the week at .5%, or 54 cents. Supporting ICE Brent pricing continues to be geo-political headlines including the Ukraine-Russia crisis, and Libya. It has only been a month since Libya's interim prime minister was appointed to his post, and after an attack on his family last week, he has announced he will step down. Factors that could reverse Brent's increase include the health of China's economy that posted its slowest pace of growth in 2 years, or a GDP increase of 7.4%, on official government estimates of 7.5%. Based on the EIA's April 2014 Short Term Energy Outlook, Brent crude oil prices are forecasted to average $2 per barrel lower this summer as compared to 2013. (See chart below)

Currently,  oil markets are down across the board with NYMEX ULSD down 76 points to 3.0006, NYMEX RBOB down 1.07 cents to 3.0440, NYMEX Crude down 19 cents to 104.11, and ICE Brent down 34 cents to 109.19.  NYMEX Crude futures expire tomorrow and will most likely cause some additional volatility as the May contract last settled at a 93 cent premium (backwardation) to the incoming June contract. Analysts are also expecting another build in crude oil stocks with the release of the EIA's DOE Inventory Report this Wednesday.

Keystone XL Pipeline decision put on hold again: The U.S. State Department announced late on Friday afternoon, ahead of the Easter holiday, that the government's review of the pipeline would be indefinitely extended. Pipeline supporter, Democratic Louisiana Senator May Landrieu expressed, "This decision is irresponsible, unnecessary, and unacceptable." Many analysts now believe that this decision pushes any final decision past mid-term elections in November, as another construction season is missed. As energy analyst Stephen Schork summarized in his daily newsletter this morning, "Nothing sends a warning to Russia's oil-centric economy like blocking access to a glut of North American crude oil." [Emphasis his]

Click here to review today's Refined Products MarketWatch.

Oil markets mixed on close ahead of Good Friday holiday

April 18, 2014

Recap: Oil markets started in lower territory yesterday morning and steadily moved higher until results of the Ukraine-Russia Geneva talks revealed an agreement that "requires all sides to refrain from violence, intimidation or provocative actions." (Reuters) The tentative agreement tabled Western economic sanctions in the short term, and oil markets moved off of their highs on the day and moved lower into the close. There was a mixed finish with NYMEX Crude finishing up 54 cents to 104.30, ICE Brent settled down 7 cents to 109.53, NYMEX ULSD (HO) down 24 points to 3.0082, but NYMEX RBOB was up 1.42 cents to 3.0547. Currently, due to Good Friday, the NYMEX and Globex are closed and will re-open at regular times for Monday's trading.

Driving season is upon us and after a harsh winter season, analysts have been anticipating that U.S. drivers will be eager to hit the roads. This holiday weekend will be a pre-test to this theory of pent-up demand, and according to the EIA's Summer Fuels Outlook released last week, forecasts for regular gasoline retail prices are to average $3.57 cents, a penny below the 2013 average of $3.58. (The summer driving season is from April to September.) The 2014 forecast and 2013 average are still more than 10 cents lower than the average 2011 and 2012 retail regular grade gasoline prices of $3.71 and $3.69, respectively. Recall, however, that the current backdrop of gasoline production has been transitioning from the winter grade to the summer grade material, and as the DOE Inventory Report revealed on Wednesday, U.S. gasoline stocks are down 5.1% since last year, and gasoline demand is up 2.8%. Since the beginning of April, NYMEX RBOB (Gasoline) futures have jumped from an April 1st close of 2.8697 to yesterday's close of 3.0547, an increase of 18.5 cents. Furthermore, just in the past week through April 14th, retail gasoline prices have jumped 5.5 cents from the previous week and 10.9 cents from the previous year (See EIA U.S. Regular Gasoline Prices chart below). As analyst Stephen Schork has been warning, there is significant concern over the geo-political issues in Venezuela, which could impact the import of intermediate/heavy sour crude oil, the crude feedstock to several key U.S. Gulf Coast refiners producing gasoline. Mexico supplied 44% of this sour crude feedstock, while Venezuela supplied 39%. In the April 16th edition of The Schork Report, Schork notes, "Thus, as we rev up for the driving summer, uncertainty remains regarding the availability of heavy sour crude from the second largest supplier to U.S. refineries in PADD 3."  We will continue to closely watch these supportive forces for gasoline prices.

Weekend Weather and HDD Planning: As April temperatures extend the heating season, Fax-Alert Weather Service has forecasted their Ten-Day Temperature Guidance report for the period April 16-April 26th.  And in most Northeast locations, we are colder-than-normal for this time of year! (HDD percentages above 100% indicate percentage increase of HDDs colder-than-normal temperatures):

New York:  NYC 98%, Binghamton 95%, Albany 105%, Newburgh 101%

New Jersey:  Newark 100%, Trenton 96%

Pennsylvania:  Philly  99%

Massachusetts:  Boston 110%, Worcester 104%, Chicopee 124%, Hyannis 110%

Connecticut: Hartford 114%, Bridgeport 108%, New Haven 107%

NH: Manchester 101%, Portsmouth 108%, Lebanon 101%, Concord, 104%

Maine: Portland 110%, Augusta 104%, Bangor 105%

Vermont: Burlington 107%, Rutland 105%

Rhode Island:  Providence 106%

Click here to view today's Refined Products MarketWatch. 

Oil markets steady after DOE Inventory data

April 17, 2014

Recap:  Oil markets were able to shrug off a bearish total commercial crude oil inventory build of 10 MMbs (on expectations of 1.75 MMbs) as NYMEX Crude finished up a penny higher to settle at 103.76 while ICE Brent Crude increased 24 cents to 109.60. Cushing crude oil stocks, where the NYMEX Crude contract is priced, fell .8 MMbs to a new low of 26.8 MMbs and are 47.5% lower than a year ago.  "While the market reaction to a large build like this would be predominantly bearish, it seems the escalating fear in Ukraine is holding prices of crude oil up,” John Macaluso, research analyst at Tyche Capital Advisors advised.  Russian-backed attacks in eastern Ukraine continue to capture headlines along with a new headline that Russia's economy is showing clear signs of distress. As reported by the Associated Press, Russian Economy Minister Alexei Ulyukayev told his parliament that "the acute international situation of the past two months and serious capital flight were to blame" for 2014 first quarter growth expanding just .8% on expectations of 2.5%, and represents a .5% contraction as compared with the previous quarter. Analysts believe that despite these results along with today's meeting in Geneva among leaders from Ukraine, Russian, the U.S. and E.U. , Russian President Putin maintains high popularity ratings and is not likely to alter his opportunistic position on Ukraine.

Products were mixed as NYMEX ULSD (HO) breached the $3 level to settle at 3.0106., up 2.36 cents as DOE inventory data showed a bullish,  larger than expected decline in total distillate stocks of 1.3 MMbs on expectations of little change from the previous week. NYMEX RBOB (Gasoline) closed down 16 points to 3.0405 as expectations of a 1.75 MMb decline did not materialize, as the draw was only .2 MMbs. Market participants will most likely be looking to square their books ahead of the Good Friday holiday where both the electronic Globex trading platform and NYMEX trading floor in New York will be closed. Trading resumes for Monday, April 21st, and the May NYMEX Crude futures contract will expire the following day on April 22nd. Currently, NYMEX ULSD is down 65 points to 3.0041, NYMEX RBOB is down 9 points to 3.0396, NYMEX Crude is up 10 cents to 103.86 and ICE Brent Crude is down 3 cents to 109.57.

DOE Inventory Highlights: Although total distillate stocks are down 3 % over last year (see EIA Distillate Stocks chart below), PADD 1 (East Coast) distillate supplies are down 5.8% over last year and are still 26% below the 5 year average. Total gasoline stocks are down 5% as compared to last year and are the below the 5 year average range (see EIA Gasoline Stocks chart below).

Click here to view today's Refined Products MarketWatch.

Ukraine-Russian conflict and potential price support to oil markets

April 16, 2014

Recap: Oil markets started in negative territory on Tuesday morning, but by settlement time at 2:30pm, the products posted positive marginal gains, while the crudes moved marginally lower. NYMEX ULSD (HO) traded in a 3 cent range with a low on the day of 2.9667, but moved higher and fell short of the $3.00 mark at 2.9977 before moving back down to settle up 79 points on the day to 2.9870.  Likewise, NYMEX RBOB (Gasoline) hit a low of 3.0100, and then reversed up to 3.0482 before settling at 3.0421, up 37 points. Crudes most likely were consolidating ahead of the weekly release of the EIA's DOE Inventory Report (see estimates below) along with the expiration of the May ICE Brent Crude futures contract. While the May Brent contract moved lower on the day, losing 33 cents to 103.75 , the incoming June Brent contract posted a slight gain of 29 cents to close at 109.36.

Ukraine takes military action:  The Ukraine-Russian conflict continues to capture headlines as a potential price support to oil markets. In a significant AP report on Tuesday afternoon, "In the first Ukrainian military action against a pro-Russian uprising in the east, government forces said they clashed Tuesday with about 30 armed gunmen at a small airport ... Ukraine's ex-prime minister and presidential candidate Yulia Tymoshenko said Tuesday what Kiev was seeing in the country's east was in effect a war. 'We have to tell the Ukrainians the truth: the Russian Federation is waging a real war against Ukraine in the east.'" Meanwhile, officials from the U.S., European Union, Russia and Ukraine are scheduled to meet in Geneva on Thursday for "negotiations aimed at persuading Russia to back off in Ukraine." This meeting will also be important to figure out how Ukraine will pay for its energy as Ukraine's Naftogaz Ukrainy has stopped paying Russian energy provider, Gazprom, after Gazprom cancelled gas price discounts to push Naftogaz's price to $13.5/MMBtu. Ukrainian aid packages continue to be worked out by the IMF, World Bank, and EU.

DOE Inventory Estimates: The EIA will report its weekly DOE Inventory Report Wednesday morning at 10:30 AM.  CitiFutures is expecting the following increase (build) or decrease (draw) ranges for the following: 1.5 to 2.5  MMb build for crude stocks, 2 to 3 MMb draw for gasoline, a .5 draw to a .5 MMb build range for distillates, and a .5 percentage point decrease in refinery % operable utilization to 87%.  Bloomberg comes in with a crude build at 1.75 MMb, a 1.75 MMb draw in gasoline, and neither a build nor draw in distillate stocks. The 5-year average for this period is a 1.3 MMb build for crude, a 2.8 MMb draw for gasoline, and a .9 MMb decline in distillates.  The American Petroleum Institute (API) released its data Tuesday afternoon with the following results: a crude build of 7.6 MMb, gasoline draw of .5MMb, and a distillate stock draw of 1.1 MMb. Stay tuned for DOE Inventory results Wednesday at 10:30am.

Winter weather in the middle of April? For the evening of April 15th,  Meteorologist John Bagioni of Fax-Alert Weather Service, LLC issued a "Snow, Sleet and Icing Potential" email Tuesday afternoon calling for sleet and snow accumulations of generally 2 to 4 inches in the following Northeast areas: north and west of Albany, NY, most of Vermont and New Hampshire, and interior Maine. NOAA's 6-10 Day Temperature Probability Outlook (see chart below) confirms that we will be seeing colder than normal temperatures in the Northeast and along the East Coast for the next week! Say it isn't so!!

Today's full market watch report in a downloadable format can be found by clicking here.