Two days of selloffs on the equities markets and growth in domestic crude stocks appears to have hammered he petroleum commodities complex with the trading session yesterday showing steep losses across the board. WTI took a $2.20 a barrel write-down, while Dated Brent absorbed a near $3 loss with both falling to $70.97 and $80.26, respectively. Products didn’t fare much better as gasoline took a 9 cent a gallon hit while diesel lost over 6 cents on a day that appeared to see little appetite for buying.
The morning brings a renewed sense of optimism on energy markets with plenty of deals to be had, especially Canadian WCS oil which can be picked up for a $55-a-barrel discount to WTI at a fire sale price of $15.97 a barrel. Brent and WTI are both on pace to pick up about a dollar in value while gasoline seems to have awoken, up nearly 2.5 cents a gallon with diesel trending up nearly a penny. Pessimistic demand forecasts of global demand in the future by the IEA and OPEC may have been overstated in recent days and the revelation that the world now consumes 100 million barrels of crude per day seems to be giving traders more reason to restore their support for the crudes.
Meanwhile, gas prices across the country continue to flirt with multi-month highs to values not seen since mid-June, according to GasBuddy’s Live Ticking Average. Today, median pump prices stand at $2.91 a gallon, up slightly from last week, 6 cents higher than last month and 44 cents a gallon higher than on this same day last year. Diesel too continues to advance over same day values in 2017, standing at over $3.30 a gallon or 57 cents above prices last year.
For the day ahead, a renewed confidence in energy markets is likely to lead to a modest recovery in what has otherwise been a down week for the petroleum markets which will have recorded their first loss overall in several weeks. PNW markets will also be closely followed today in anticipation of news that a critical natural gas pipeline that ruptured on Tuesday, which supplies feedstock to several Washington refineries, will resume. Currently, the premium price for gasoline stands at 55 cents a gallon above NYMEX and the spread represents a record not seen since mid-2013.