Markets took an unexpected turn for the better yesterday as the EIA’s Weekly Petroleum Status Report turn out to be more bullish than thought with a smaller than expected 1.3 million barrel increase in oil stocks, while gasoline inventories rose a slight half million barrels and diesel supplies fell 2.3 million barrels. For the second week in a row, forecasts of large crude stockpiles failed to materialize as did the bearish trades associated with bad news. Not surprisingly, WTI gained 35 cents a barrel to land at $54.01 while it’s international benchmark counterpart, Dated Brent rose 71 cents to end the trading session at $62.69. Refined products, too, rose in reaction to the report with gasoline gaining nearly 4 cents a gallon in value while distillates picked up over a cent and a half.
The morning trading session is again trending to the negative in response to concern in Europe over both slower growth for its leading economy, Germany and a structural recession in Italy. A revision of .6% drop in estimated growth for the region and continued uncertainty over Brexit is also stoking pessimism.
For American drivers, the back-and-forth on the markets which have seen little in the way of breakout pricing continues to keep pump prices at bay. According to GasBuddy’s Live Ticking Average, at $2.296 cents a gallon, the cost to fill up has risen 2 cents since last week and 5.5 cents compared to last month, but still remains 30.5 cents a gallon lower than on this same date in 2018. Turning to diesel, at $2.924 a gallon, the cost to fill up has not moved in the past week and is 1.8 cents cheaper than last month. By contrast, diesel prices were 6.1 cents above today values this time last year.
For the day ahead, unless there emerges some unknown cause for general optimism affecting energy fundamentals, the markets are most likely to confirm their weaker morning trend with losses generally across the board for both the crudes and refined products. The cuts in growth forecasts by the European Commission, little impact on crude supplies thus far in light of sanctions on the Maduro regime in Venezuela and even a disruption to the Keystone pipeline last evening are failing to prop up markets that appear to be taking a wait-and-see-approach before coming to any decision for a breakout in prices. February is on track to behave the way most winter months do; little movement either way for the month ahead.