Energy markets posted a remarkable recovery yesterday on the heels of concerns over widespread damage to the Carolina’s in advance of the arrival of Hurricane Florence, despite such events being traditionally demand destructive. WTI gained $1.71 to wind up the day at $69.25 with Dated Brent managing a $1.79 build to $79.16 a barrel, while refined products enjoyed more than a 3-cent-a-gallon increase on a series of news reports which traders took as bullish signs. The overarching concerns being a strain on global oil and fuel supplies, including concerns over the effect of sanctions on Iran and a setback in oil production from Libya which pushed the gap between the two benchmark oils to nearly $10 a barrel.
The API’s prognostication of a massive 8.636 draw in domestic crude supplies, including a 1.165 drop in inventories at Cushing is given a lift to WTI this morning, rising three-quarters of a dollar, allowing it to approach and breach the $70 a barrel threshold and closing the gap on Brent in the process. Benefitting from the rise in crude prices is gasoline, which despite the advance guess, is up over a penny a gallon while diesel is managing a half penny gain so far. But the development of a new disturbance in the Gulf of Mexico and thought to be bringing heavy rains later in the week to Texas and Louisiana has also drawn the attention of markets which need to factor in disruptions to drilling and flooding, which as seen last year with Hurricane Harvey, is a refinery’s greatest challenge.
Fuel prices across America continue to remain stable, including the three states in the path of Hurricane Florence. Despite one sensational report, the GasBuddy Live Ticking Average shows that average prices since yesterday actually fell a penny in Virginia, no change in South Carolina, and a slight half penny uptick for North Carolina. For the rest of the country, pump prices remain virtually unchanged at $2.84 a gallon which is steady compared to the past week and past month’s costs, but 20 cents a gallon higher than Hurricane Harvey era prices this time last year. The alternative fuel of choice, diesel is maintaining its value at $3.18 a gallon, 48 cents above prices this time last year.
Markets will be focussing on today’s EIA Weekly Petroleum Status Report to see any deviation from the API’s directional estimations as well as growing meteorological concerns.
For drivers in the path of dangerous Hurricane Florence, we offer the opportunity to know fuel and power availability of all gas stations with the activation of the GasBuddy Fuel Outage Tracker. For the regular updated status of fuel availability at gas stations, go to: https://www.gasbuddy.com/go/florence-live-updates-fuel-availability-station-outages/