What the market takes, it gives back. Yesterday, crude fell $2.34 and today it rose $2.64. The catalyst for the upsurge was the economic report that announced a 3.5% growth in GDP. Jobless numbers were also down minimally. This may be a jobless recovery and, if so, it would also be a demand-less growth economy. People at work and confident about tomorrow spend money and some money will be spent on fuel. No job, why take the road trip? Since so much of driving is discretionary, how much will be cut back?
Gasoline rose 3.2 cents and distillate also rose 6.2 cents.
The announcement by Argus that its Sour Crude Index will be adopted by Saudi Aramco to set prices for oil sold in the US is a move against the NYMEX benchmark based on the Cushing, OK, barrels. Is this movement away from Cushing and following a Gulf benchmark going to be able to help measure risk against volatility?
What about NY Harbor pricing for heating oil that is used to index all distillate?
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