June 30, 2010

There was a draw on crude supplies but builds for gasoline and distillate while refinery utilization was down. This is the summer driving season and production is down while inventory is up. This is definitely demand deterioration. Crude prices fell for a 3rd consecutive day but were still up on a month to month basis. The background for all this is Hurricane Alex in the Gulf and about to make landfall but the oversupply of crude and product had kept prices down.

For the month, crude +$2.63, $75.63, gasoline +4.7¢, $2.0606, distillate +0.62¢, $1.9817.

June 29, 2010

The downward revision of one of China's leading economic indicators and the decline in US consumer confidence once again led to fears that the global economy was not improving but actually deteriorating. In turn this led to significant decreases in crude and product futures prices. Despite Treasury Secretary Geithner's statement yesterday that the rest of the world had to pick up the economic pace and could not rely on American economic prowess, investors and analysts look for the US economy to pick up before the world economy can be deemed to be improving. The corollary to that scenario is that if the US economy improves then there will be Chinese goods to be sold in the US and then worldwide demand for oil and oil products will increase.

Tomorrow's EIA inventory reports will give direction to the market for the rest of the week although the upcoming three day July 4th weekend will also have analysts worrying about the state of markets prior to the holiday.

Today, crude -$2.33, $75.94, gasoline -6.64C, $2.0716, distillate -7.36¢, $2.0209.

June 28, 2010

Fears of hurricane force winds blowing through the oil production areas of the Gulf of Mexico abated over the weekend and that led to a modest price decrease for crude, gasoline and distillate. The market discounted the good news about the increase in the savings rate and instead focused on the rejection of the stimulus type spending that The Obama administration was urging on the other G20 participants. There was little notice of the increase in consumer spending and personal income nor was the dollar's rise much noticed.

Today, crude -61¢, $78.27, gasoline -2.999¢, $2.0945, distillate -1.78¢, $2.0945.

June 25, 2010

The revised lower GDP did not affect prices today and the the falling dollar was not considered the main reason why prices dropped. The fear of a tropical storm developing in the Gulf of Mexico and disrupting supply raised prices to the highest level since May 5. Prices have been staying in the $75 to $78 channel for a couple of weeks but today's price surge led beyond $79 but settled barely below that number. Product prices followed suit and overcame the worries about weak demand.

For the week, crude +$1.71, $78.88, gasoline +7.76¢, $$2.1679, distillate, +5.61¢, $2.1123. Street prices up to $2.479.

June 24, 2010

Crude took a sideways turn today,first falling and then recovering before staying just a little behind yesterday's close. Gasoline finished higher while distillate fell moderately. Economic news is not so good with housing starts' decline overcoming the tiny fall in unemployment claims. The slight increase happened even after the full impact of yesterday's inventory reports came to be more fully understood as bearish on the market because it augurs continuing weak demand.

Today, crude -8¢, $76.37, gasoline +0.49¢, $2.0903, distillate -1.53¢, $2.0562.

June 23, 2010

Inventory took center stage as it does most Wednesdays when the EIA releases the stock level report on crude and product. Although there were builds in crude and gasoline, distillate saw a decline. Even though crude and gasoline were drawing on inventories, diesel supply increased.There is no clear direction in which the market is moving but even with the inventory build, analysts are unsure of the economy's direction.

Today, crude -65¢, $76.45, gasoline -4.76¢, $2.0854, distillate -4.1¢, $2.0715.

June 22, 2010

Weaker than expected economic news from retail sales and housing starts overcame yesterday's news of impending changes in China's yuan that would lead to greater Chinese economic activity leading to crude's fall for the first time in three trading days. The strengthening of the dollar vs. the euro finalized crude's movement for the day and insured that products also followed crude's move down. Tomorrow EIA will release the inventory report and that should determine where prices go unless there are very dramatic movements in the currency markets or the economy.

Today, crude -77¢, $77.10, gasoline -0.9¢, $2.133, distillate -3.25¢, $2.1125. Distillate fell more than gasoline because of greater gasoline demand expectations over distillate demand.