Petroleum markets regained their early day losses yesterday closing the trading session with a burst of energy that saw WTI manage a slight 13 cent a barrel gain to $52.59, while its European counterpart, Dated Brent rose 24 cents to $61.68 to show a tenth straight day of consecutive modest gains. The result of the streak means oil is now $10 a barrel above its Christmas Eve low of $42.53 a barrel for WTI and places its value back to levels last seen on December 7. Refined products too were resurrected from the morning mayhem with slight gains for gasoline which rose a fraction of a penny while diesel gained almost two and a half cents.
The morning revisits yesterday’s pattern of a weak start to the trading day with oil down 30 cents a barrel while fuels look to near 1 cent a gallon losses, which could be made up by day’s end. Markets may be considering the weight of data that may be countering the recent rally and bringing price discovery more in line with fundamentals. As such, the day may well mark an end to a rally which has bewildered many who saw 2018 end with a virtual collapse in the energy price complex, mirroring the end of year fall in the equities markets.
For drivers, however, the status quo is nothing to complain about as pump prices continue to offer up decent savings compared to previous milestones throughout the previous year. According to GasBuddy’s Live Ticking Average, the price paid at the pumps has edged up slightly by 2 cents a gallon this week, but still 15.2 cents less than last month and 27 cents below this day last year. On the diesel side of the equation, at $2.947 a gallon, the cost to fill up on the vital transportation fuel is down 16.5 cents from a month ago but still 5.1 cents higher than January 11, 2018.
Friday presents an opportunity for markets to take a breather and assess the legitimacy of the recent rally in energy futures. The losses this morning are therefore likely to accelerate in the afternoon as pause is given to a streak in consecutive gains in oil’s value not seen in two years. Expectations for the day ahead are therefore losses overall on what has otherwise been a second week of net gains on the markets.