The complete energy commodities markets took a direct hit yesterday as traders dumped their crude futures holdings by a staggering 7.8%, the single largest one day drop in seven years, sending WTI tumbling $4.23 a barrel, while Dated Brent fell $4.65 to land at $65.47.

Market participants jettisoned their positions yesterday after OPEC admitted that global demand for oil would slacken in 2019 and revised downwards by 70,000 barrels a day, their expectations for growth in overall demand. Combined with a telling surge in non-OPEC production, a drop in demand and a surge in output served as a one-two punch to crude values. The drop also saw substantial decreases in the value of refined products which saw gasoline surrender nearly 10 cents a gallon from its Monday settlement, while distillates took an 11 cent beating. Although prices seem to be recovering, profit making will be little match for the overall negative mood of the markets that remain unimpressed with last-minute waivers given to key oil importing nations from what was to be a guaranteed and effective embargo on all Iranian crude. The day will likely see a repeat of Monday when early morning moves into positive territory were met with an avalanche of pessimism.

For drivers, the news couldn’t be better as gas prices continue their gentle descent, albeit less than what one would expect given the rout on markets. According to GasBuddy’s Live Ticking Average, median pump prices now sit at $2.68 a gallon, down 5 cents compared to last week, a full 20 cents below last month, although still 10.6 cents higher than on this same day last year. For diesel, which has captured substantial value in 2018, the cost to fill up now stands at an average of $ 3.24 a gallon or 40 cents higher than last year.

The dour mood on the markets, abetted by the news that non-OPEC producers will more than compensate for the anticipated 1.3 million barrel a day demand in 2019, casts a pall on crude and energy futures in general. While pump prices remain sticky, an inevitable drop in gas prices are in the offing and a net 10 cent a gallon drop is possible before Americans take to the roads for a Thanksgiving in which the cost of filling up, will be as cheap, if not cheaper than the days leading up to the holiday. Even with an unlikely bullish EIA report tomorrow, as far as markets are concerned, the die is cast and a further downward correction in petroleum prices are at hand, despite today’s early dead cat bounce.