What a move for crude prices in December. WTI prices have risen more than 16% this month to $53.67/bbl today on the heels of the OPEC/non-OPEC production cut deal which will begin in January. However, with prices in December ending sharply higher, many are wary that prices have the potential of falling in January once we begin to get word of OPEC’s output for the month.
Yesterday’s oil market saw its winning streak extend to seven days, the longest in four months, as crude prices finished the day up slightly to settle at $54.06 per barrel, its highest level in 17 months. RBOB also finished the session higher by $0.0218 to close at $1.6746 while HO was down slightly by $0.0001 settling at $1.6993. The recent surge in crude can be attributed to the market’s continued reaction and anticipation of OPEC and non-OPEC producers cutting output to reduce or eliminate the current supply glut.
Yesterday, WTI crude closed up $0.88 to $53.90/bbl, RBOB closed up $0.0266 to $1.6528/gal, and HO finished up $0.0366 to $1.6994/gal. No real news drove the market yesterday, just talk surrounding the OPEC/non-OPEC deal and traders waiting to see if participants hold to the agreement starting in the New Year. The first OPEC/non-OPEC meeting for the monitoring committee is scheduled for January 13th.
As some of us start our week today, trading is light throughout the entire oil complex, thanks to the corporate holiday yesterday. This is expected to continue throughout the week as many traders are out on vacation. This “light” trading means that we could see big swings in prices because there aren’t a lot of market players, which increases volatility.
Trading is light on the last trading day before Christmas weekend. Keep in mind the market settlement will be at 1:30 p.m. EST versus the normal 2:30 EST and will reopen Monday at 6:00 p.m. ET. So, effectively markets will be closed on Monday in observance of Christmas.
The API and the DOE reports really contradicted themselves once again. As you may recall from earlier this week, the API reported a 4.1 million barrel draw in crude and yet the DOE stats yesterday showed a 2.3 million barrel build. This build seemed unexpected considering refinery rates have risen due to a heavy influx of Crude imports. Imports hit a seven-week high of 1.039 mpbd. Read More
Yesterday, WTI crude closed up $0.11 to $52.23/bbl, HO closed down $0.0002 to $1.6688/gal, and RBOB finished up $0.0297 to $1.5936/gal. After the release of the API statistics last night, oil prices were trading up. The API statistics showed draws across the board; crude drew 4.1 million barrels, gasoline 2 million barrels, and distillates 1.6 million barrels. However, this morning the market is pretty flat, so it does not seem like the market believes these statistics.
As we near the end of 2016, the bulls appear to have grabbed the market by the horns. Prices are close to the highs of the year as we edge closer to the January OPEC production cuts. We expect these high prices to be sustained into the holidays for other reasons as well.
Regular readers of the Fuel Matters blog have probably just about had it with OPEC by now. A quick check shows over sixty OPEC references in this blog during the last two weeks alone. Understandable, certainly, given the recent surge in oil prices that showed just how relevant the cartel remains. But, really, we could use a break. Lots of interesting things going on here in the U.S., so let’s dig into that:
Yesterday, WTI crude closed up $0.15 to $52.98/bbl, HO closed up $0.0030 to $1.6747/gal and RBOB finished up $0.0077 to $1.5507/gal.