Prices for February 9th, 2010
| HEATING OIL cents per gallon | | MONTH | HIGH | LOW | SETTLE | CHANGE | | MAR | 194.99 | 187.47 | 193.73 | up 05.18 | | APR | 195.45 | 188.35 | 194.44 | up 05.10 | | MAY | 195.93 | 190.80 | 195.33 | up 05.05 | | JUN | 197.16 | 192.01 | 196.48 | up 04.92 | | JUL | 198.75 | 194.25 | 198.45 | up 04.86 | | AUG | 200.75 | 196.52 | 200.52 | up 04.83 | | SEP | 203.13 | 198.73 | 202.76 | up 04.79 | | OCT | 205.25 | 201.18 | 205.20 | up 04.76 | | NOV | 207.65 | 203.99 | 207.58 | up 04.73 | | DEC | 210.18 | 203.77 | 209.95 | up 04.70 | | JAN | 212.25 | 208.75 | 212.35 | up 04.65 | | FEB | 213.80 | 210.25 | 213.70 | up 04.60 | | Estimated Volume (day before) total all prev day 84,958 | | NYMEX CRUDE OIL dollars per barrel | | MONTH | HIGH | LOW | SETTLE | CHANGE | | MAR | 74.15 | 71.32 | 73.75 | up 01.86 | | APR | 74.57 | 71.72 | 74.20 | up 01.91 | | MAY | 75.00 | 72.20 | 74.71 | up 01.95 | | JUN | 75.51 | 72.72 | 75.24 | up 01.98 | | JUL | 76.01 | 74.26 | 75.77 | up 01.99 | | AUG | 76.35 | 73.85 | 76.25 | up 02.01 | | | | | | | | | Estimated Volume… 642,005 Opec Basket…$68.86 dn $0.85
Prompt #2 Oil NYH 88..-1.25 to -1.00, 74 Lo S…+0.75 to +1.00
US Gulf 88 grade…-4.50 to -4.25, 74 grade Lo S…-1.00 to -0.50 Group .........-6.50 to -6.00 Lo S.....-6.50 to -6.00
Chicago ......-6.00 to -5.00 cash quotes by Dow Jones | | | |
| NYMEX RBOB GASOLINE cents per gallon | | MONTH | HIGH | LOW | SETTLE | CHANGE | | MAR | 194.88 | 188.27 | 192.90 | up 03.50 | | APR | 206.12 | 199.80 | 204.50 | up 04.11 | | MAY | 207.14 | 201.78 | 205.84 | up 04.28 | | JUN | 207.01 | 200.66 | 206.23 | up 04.33 | | JUL | 206.50 | 202.50 | 205.84 | up 04.41 | | AUG | 206.00 | 203.54 | 205.05 | up 04.44 | | SEP | 204.42 | 201.55 | 204.12 | up 04.41 | | OCT | 194.35 | 192.35 | 194.32 | up 04.45 | | Estimated RB Volume day before 89,819 | | NYMEX NATURAL GAS dollars per mmBtu | | MONTH | HIGH | LOW | SETTLE | CHANGE | | MAR | 5.466 | 5.262 | 5.290 | dn 0.111 | | APR | 5.442 | 5.238 | 5.265 | dn 0.106 | | MAY | 5.501 | 5.301 | 5.328 | dn 0.100 | | JUN | 5.571 | 5.393 | 5.406 | dn 0.098 | | | Estimated Volume…day before (283,429)
Nymex statistics are based on composite Access & Day Sessions
Prompt Gasoline NYH M5 -1.00 /-0.50 RBOB +3.50 /+4.00
US Gulf M4: -5.25 to -5.00 RBOB -0.25 to +0.00
L.A. Conv Reg 201.00-202.00, N-grade Group 184.90-185.40 Chi 177.40-178.40 | |
Market Review for Tuesday
TRONGER equities and a weaker US dollar were factors early yesterday that helped to push oil prices higher. At the heart of the change in perceptions were reports that a rescue plan had been devised to help Greece out of its sovereign debt dilemma. German officials sent prices back down again with their first denial of any comprehensive agreement in place, but by the end of the day, traders and investors had bought into the idea that the worst was now behind us in the sovereign debt picture.
The DJIA gained 150 points and the US dollar was under selling pressure all day. These moves pushed oil prices higher, and there was a note of urgency among some shorts looking to cover, as forecasts for a blanket of snow across the Northeast created nervousness that traders might not make it to work today. This fear was underlined by yet another day of Washington DC being shut down. And petropolitical concerns brought in yet other buyers, with unrest in Teheran.
| Fuel for Thought Roughly a hundred pro-government Iranian militiamen tried to storm the Italian Embassy in Teheran yesterday, with similar “protests” at the French and Dutch missions also reported. These were apparently in response to comments made by Italian President Berlusconi (pledging support to Israel) and to EU support for “effective sanctions” for recent nuclear moves. Russia’s Foreign Ministry also said that Iran’s recent nuclear moves heighten “doubts on the sincerity” of Iran’s government “to end the international community’s existing concerns” over Teheran’s nuclear ambitions. Iran recently decided to enrich its own uranium to 20%, bypassing an understanding that its 3% material would be enriched in Russia and France. |
While it is uncertain whether the German government will have any positive answers for the Greek debt situation, investors were encouraged that European Central Bank President Jean-Claude Trichet had cut short a trip to Australia to prepare for a European Union Council meeting tomorrow. Greece and the related sovereign debt issues are certain to be discussed.
Heating oil prices led the oil complex higher yesterday as traders were reminded by the imminent blizzard of colder weather forecasts for the next two weeks. Cold weather recently is expected to boost heating oil demand.
Iran started enriching uranium to levels nearer weapons grade yesterday at the country’s pilot enrichment facility in Natanz. The enrichment is at least open to monitoring by IAEA inspectors. At the same time, though, the unilateral decision to enrich nuclear material to a higher grade is being viewed negatively by just about everyone. President Obama said yesterday that “We have bent over backwards … to have a constructive conversation with [Iran]. The next step is sanctions.” Israeli Prime Minister Benjamin Netanyahu has called on the UN Security Council to inflict “crippling sanctions … right now.”
Technicals
The oil complex was higher yesterday, although it does not yet look like the beginning of some dramatic new trend higher. It is certainly possible that it will become that, but that would seem to require an important top in the dollar and an equally significant low in equities. We cannot yet say that all three markets have turned, and it would seem that the fate of one is wrapped up in the fate of the other two. Certainly, oil seems dependent upon the dollar and equities.
Dollars per barrel
Above: Heating oil prices have found support, but they remain beneath the trendline broken last week.
March crude oil now has buy-stops over $74.15, $77.20, $78.05, $78.36, $79.31-$79.47, $80.67, $82.35, $83.95, $84.83, $85.13, $89.82, $90.99, $93.02, $96.03, and $100.37. Sell-stops are under $71.30, $70.75, $69.30, $68.55, $68.00, $65.80-$66.20, and $64.95. March heating oil has buy-stops over 195.00, 202.65, 203.75, 204.45, 205.75, 208.10, 210.91, 211.90, 217.55, 222.72, 225.80, 227.05, 229.08, 238.95, 249.62, and 251.50. Sell stops are under 187.45, 186.50, 182.63, 177.00, 176.68, 173.75, 171.10, 170.35, and 168.60. March RBOB has buy-stops over 194.90, 195.95-196.00, 203.75, 206.65, 206.88-207.35, 208.30, 214.60, 219.27, 222.70, 228.86, 240.10, 250.40, 252.00, 265.10, 267.85, 270.85, 272.00, and 280.25. Sell-stops are under 188.25, 187.00, 184.15, 182.40, 181.20, 179.20, 177.30, 175.14, 171.40, and 170.25.
Football: The bears lost 19 yards on second and 17, making us wonder if the bulls fumbled. It’s third and 36 to go for the bears.
Technical Support & Resistance
Mar crude oil Support: $71.15-$71.30, $70.55-$70.70, $69.30-$69.45, $68.50-$68.60, $68.00-$68.20.
Resistance: $73.90-$74.15, $77.05-$77.20, $77.95-$78.05, $78.25-$78.36, $79.31-$79.50.
Mar heating oil Support: 187.45-187.60, 186.50-186.65, 182.60-182.75, 177.00-177.20, 176.65-176.75.
Resistance: 194.85-195.00, 202.50-202.62, 203.50-203.72, 204.35-204.45, 205.60-205.75.
Mar Rbob Support: 188.25-188.40, 187.00-187.15, 184.15-184.30, 182.40-182.55, 181.20-181.35.
Resistance: 194.75-194.90, 195.80-195.95, 203.60-203.75, 206.25-206.35, 206.60-206.65.
Oil Inventory Reports
This week’s DOE report does not have as strong a history as many of the recent reports we have reviewed. The best proportion of years in one direction was six years out of eight for lower distillate stocks. Utilization was also higher in six of the last eight years (for an average increase of 0.563%). Both crude oil and gasoline stocks were higher in five of the last eight years, and there have been some big builds (4.9 million bbls in gasoline stocks in 2005, and 4.9 mln bbls in crude in 2006). Crude oil imports have trended lower this week, although the eight-year average bears no relation to what we will see this week.
Last Week’s Inventory Comparison: Distillate stocks are now 12.8 million bbls, or 8.91%, higher than a year ago. Heating oil inventories are 3.9 mln bbls, or 10.24%, higher than they were a year ago. Gasoline stocks are 10.8 mln bbls (up 4.97%) higher against a year ago. Crude oil stocks are now 21.3 million bbls, or 6.08%, lower than a year ago. Residual stocks are 4.2 mln bbls (11.83%) higher than a year ago, jet fuel stocks are 2.9 mln bbls, (7.20%) higher than a year ago. Utilization is 5.80% lower than a year ago and 8.70% below the eight-year average. It is 9.88% lower than the four-year, pre-Katrina average and 7.52% below the average of the four years since the big hurricanes (Katrina & Rita) in 2005.
Last Week’s Demand: Four-week, total refined products demand came in at 18.750 million bpd, down 0.003 mln bbls on the week, and down 0.375 mln bpd and 1.96% against a year ago. Four weeks ago, it was 0.050 mln bpd and 0.26% higher than a year ago. Four-week gasoline demand is at 8.644 mln bpd, down 0.53%, compared to up 0.32% four weeks ago. It fell 32,000 bpd on the week. Four-week distillate demand is now at 3.705 mln bpd, down 9.08%, compared to down 0.98% four weeks ago. Four-week jet demand is now at 1.360 mln bpd, up 0.22% against a year ago, compared to up 8.17% four weeks ago. Four-week residual fuel demand is at 0.461 mln bpd, down 34.14%, compared to down 1.19% 11 weeks ago. Propane use is up 13.63%, at 1.634 mln bpd.
This Week’s API Report: This week’s API report showed a build of 7.195 mln bbls in crude oil stocks, a draw of 1.531 mln bbls in distillate stocks and a build of 1.552 mln bbls in gasoline inventories. Utilization was down 1.0% to 77.0%. Implied demand came in at a paltry 8.320 mln bpd in gasoline and at 3.957 mln bpd in distillate. Crude oil imports were down 0.096 mln bpd to 8.375 mln bpd. Gasoline demand was so low we checked our figures twice. Production was 8.274 mln bpd.
DOE Weekly Inventory Statistics
| Category | Final DOE Estimate
This Week’s Estimate | History
Last Year’s Report | Most Recent Changes
Last Week’s DOE Report | Versus A Year Ago
Millions of Barrels |
| Distillate | dn 2.00 to 2.50 mln bbls | dn 1.066 | dn 0.948 mln bbls | up 12.800 |
| Gasoline | up 1.00 to 1.50 | dn 2.662 | dn 1.306 | up 10.800 |
| Crude oil | up 1.25 to 2.25 | up 4.717 | up 2.317 | dn 21.300 |
| Utilization | up 0.3% to 0.8% | dn 1.9% at 81.6% | dn 0.75% at 77.70% | |
| Crude Imports | dn 0.000 to 0.500 mmbd | dn 0.385 to 9.652 | up 0.559 to 8.426 mln bpd | |
| DOE Distillate Demand | 3.659 mln bpd | dn 066,000 | Gasoline Demand | 8.613 mln bpd | dn 006,000 |
| DOE Distillate Production | 3.484 mln bpd | dn 032,000 | Gasoline Production | 8.584 mln bpd | dn 052,000 |
| DOE Distillate Imports | 0.438 mln bpd | dn 220,000 | Gasoline Imports | 0.926 mln bpd | up 103,000 |
Source: US Department of Energy’s Energy Information Administration
Open Interest Analysis
Crude oil open interest grew by 3,412 contracts on Monday, when prices rallied. That looks like new buying and is supportive. With yesterday’s rise on a weaker dollar and stronger equities, we expect there was new buying.
Heating oil open interest rose by 315 contracts on Monday, when prices were higher. That looks like new buying and is supportive.
RBOB open interest grew by 243 contracts on Monday when prices were higher. That looks like new buying, which would be supportive.
Natural gas open interest fell by 509 on Monday, when prices were lower. That looks like long liquidation and would be supportive.
Monday’s Open Interest Changes:
Crude 1,308,935 up 3,412 Heat 311,969 up 315 RBOB 255,574 up 243 Nat gas 781,088 dn 509
CFTC Commitments of Traders for Nymex (for the period ended Tuesday, Feb 2nd)
Crude oil prices gained $2.57bbl over the latest reporting period, and the best buying came from the “other reportables” category, which added 1,623 longs, but which also added 1,123 new shorts. Producers covered 6,749 shorts and liquidated 8,284 longs. Managed Money liquidated 2,386 longs and added 160 shorts while Swap Dealers liquidated 802 longs and covered 515 shorts. Based on these figures, we must deduce that day-trading helped push quotes higher – none of this did.
In heating oil futures, prices were up 7.34 cents a gallon, and the best net buying came from Swap Dealers, who bought 3,861 new longs and covered 72 shorts. Producers bought 832 longs and covered 4,783 shorts. Managed Money was on the short side, liquidating 1,388 longs and adding 2,498 new shorts. Other Reportables liquidated 698 longs and added 99 shorts. The motive buying, though, seems to have come from Swap Dealers on this round.
Gasoline prices gained 4.49 cents a gallon during the period under review. Producer short-covering seems to have given us the best buying; Producers liquidated 5,079 longs and covered 9,475 shorts. Swap dealers liquidated 1,444 longs and covered 720 shorts. Other reportables liquidated 212 longs and covered 769 shorts. Managed Money liquidated 2,406 and added 908.
In natural gas, prices gained 3.2 cents during the period under review. Producers added 130 longs and added 2,442 shorts. Swap dealers added 6,926 longs and added 5,048 shorts. Other Reportables added 280 longs and added 3,861 shorts. Net short-covering by Managed Money, which liquidated 11,763 longs and covered 18,540 shorts, was the motive force.
Natural Gas & Utility Generation
Natural gas prices were down a little more than 11 cents – again - yesterday, as traders continued to focus on the last two EIA underground storage reports and the changes they introduced to the surpluses against a year ago and against the five-year average. After effectively getting rid of those surpluses with the report released three weeks ago, we are now back to a year-on-year surplus of 199 bcf, or 9.02%. Against the five-year average, storage amounts are now 150 bcf and 6.65% higher. Considering where these figures were three weeks ago, the existing figures are extremely disappointing. Last week, traders turned to the weather after the report came out; yesterday, they returned to the storage figures as traders starting checking off the days officially left in winter. Even though, winter might be thought to be on short time here, there is plenty of cold weather left, which is something this market always seems to revisit in March.
Looking ahead, the EIA has a five-year average drawdown this week of 155 bcf, and next week that will decline to 129 bcf, according to Bloomberg. Our five-year average for this week is 148 bcf, with last year showing a draw of 159 bcf. Early estimates for this week’s withdrawal seem to be falling in the 170-180 bcf zone, but there are already some very early estimates for next week’s numbers, with at least one estimate hovering around a withdrawal of 200 bcf. That sort of drawdown, in a week that has averaged pulls of less than 130 bcf, would be supportive, especially if the forecasts for colder weather continue.
At this stage, temperature forecasts continue to come out on the colder side, with the National Weather Service (NWS) having predicted a steady stream of colder-than-normal readings from the start of the month all the way to February 22nd, as of this writing. Yesterday’s outlook, covering the period from February 16th to 22nd is calling for colder-than-normal readings east of the Mississippi and extending west into the northern Plains and as far southwest as Texas. In effect, that covers almost everything east of the Rockies. This suggests that we should have decent to potentially larger-than-historical drawdowns in reports released all the way through the end of this month.
In cash trading yesterday, Henry Hub prices were at $5.49-$5.60, down 0.17-$0.19 on the day (DJN). SoCal prices were at $5.50-$5.59, down $0.20-$0.21 on the day. El Paso Permian prices were down $0.16-$0.19 to $5.30-$5.46. Katy prices were down $0.17-$0.19 to $5.42-$5.53. Waha prices were down $0.22-$0.22 at $5.40-$5.53. Transco 6 was down $2.25 and up $0.15 at $7.15-$7.50/mmBtu, according to Dow Jones News (DJN). Traders sold northeastern pipelines somewhat yesterday.
Palo Verde prices were last quoted at $49.00-$51.00/mwh. Northeastern prices last traded at $39.00-$61.50. Entergy was last at $47.75-$48.25. Ercot was last at $51.80-$52.50/mwh.
Support is at $5.22-$5.25, $5.12-$5.14, $5.06-$5.08, $4.96-$4.99, $4.83-$4.85, $4.64-$4.66, $4.40-$4.43, $4.15-$4.17, $4.05-$4.08, $3.73-$3.75, $3.66-$3.68, $3.50-$3.53, $3.44-$3.46, $3.28-$3.32, $2.91-$2.93, $2.80-$2.82, $2.74-$2.75, and $2.69-$2.70. Resistance is at $5.46-$5.47, $5.55-$5.60, $5.87-$5.90, $5.99-$6.03, $6.09-$6.11, $6.15-$6.17, $6.34-$6.37, $6.65-$6.69, $6.90-$6.94, $7.01-$7.04, $7.28-$7.31, and $7.34-$7.36.
Mar Natural Gas: Support: $5.22-$5.25, $5.12-$5.14, $5.06-$5.08, $4.96-$4.99, $4.83-$4.85, $4.64-$4.66.
Resistance: $5.46-$5.47, $5.55-$5.60, $5.71-$5.73, $5.87-$5.90, $5.99-$6.03, $6.09-$6.11.
Natural gas prices remain below their trendline. The decline over the last two days looks bearish.
Dollars per million Btu
The trendline is the dominant feature on a number of charts.
Dollars per million Btu
EIA Weekly Storage Figures
Last week’s EIA report showed a draw of 115 bcf on expectations for a draw of 122-124 bcf. Stocks are now 199 bcf higher than a year ago, against a surplus of 120 bcf a week ago, a surplus of 22 bcf two weeks ago and a surplus of 103 bcf three weeks ago. Stocks are now 9.02% higher than a year ago. They are 150 bcf and 6.65% above the five-year average.
For this week, the eight-year average (of similar Friday reports) was a draw of 158.58 bcf. The five-year average was a draw of 147.6 bcf. Last year’s draw was 159 bcf. The EIA report will be released at 10:30 AM EDT on Friday morning.
EIA Report
| Region | 01-29-10 | 01-22-10 | Change | Last Year | 5 Yr Avg |
| Cons East | 1251 | 1334 | dn 83 | 1105 | 1236 |
| Cons West | 359 | 380 | dn 21 | 337 | 301 |
| Producing | 796 | 807 | dn 11 | 765 | 720 |
| Total US | 2406 | 2521 | dn 115 | 2207 | 2256 |
Bcf, or Billions of cubic feet. Source: Energy Information Administration, US Department of Energy
News & Views
| In trading on Nymex, March crude oil prices were up $0.32 at $74.07/barrel at 7.30 AM EST, this morning. March heating oil prices were up 0.43 cents to 1.9416/gallon. March RBOB prices were up 0.77 cents to 1.9367. March natural gas prices were up $0.045 to $5.335/mmBtu. Oil prices were higher this morning despite a huge build in API crude oil stocks and poor demand values. And the dollar was higher, too, so it may not last. DOE Expectations The table below lists the final survey results for Dow Jones, Bloomberg and Reuters. The DOE report will be released at 11:00 AM EDT on Friday morning this week because of the huge snow storm experienced in Washington, DC. Category Dow Jones Bloomberg Reuters Crude up 1.300 up 1.500 up 1.500 mln bbls Distillate dn 1.800 dn 1.600 dn 1.900 Gasoline up 0.100 up 0.300 up 0.500 Utilization up 0.3% up 0.1% up 0.2% 
Crude oil prices rallied fairly steeply yesterday, as traders took their cue from stronger equities and a weaker US dollar. Crude has support at $68.55 and again at $70.77. | 
Heating oil prices were also well higher yesterday, buoyed by stronger equities and the weaker US dollar. Support remains in this market at 182.70, which was Friday’s low. DOE History: Distillate stocks have fallen in six of the last eight years, by an average of 2.838 mln bbls. The eight-year average is a draw of 1.991 mln bbls. Gasoline stocks rose in five of the last eight years, for a five-year build of 2.560 mln bbls and an eight-year average build of 0.867 mln bbls. Crude oil stocks have been higher in five of the last eight years for a five-year average build of 3.063 mln bbls and it has an eight-year average build of 0.940 mln bbls. Utilization has been higher in six of the last eight years (up 1.18%) and has an eight-year average increase of 0.56%, and it has an eight-year average utilization figure of 86.96%. The four-year, pre-hurricane utilization average was 89.08%. Since Katrina, refineries have run at an average utilization rate of 84.85%. Crude oil imports have been lower in three of the last six years, and the average crude oil import figure over the last six years has been down 374,000 bpd. The average crude oil import figure over the last six years has been 9.686 million bpd. Imports were 1.260 million bpd below that average in last week’s report. That’s 13.0% lower. |
| Crude prices rallied because of higher equities and a weaker dollar | |
Trading volume could be on the lighter side today, as schools and businesses have closed ahead of today’s much-heralded blanket of snow from Richmond to Boston. This could mean we see steeper moves, or it could mean prices sit still. We need to be aware of the storm’s potential impact.
An Illustrated Look at Energy Market Factors
A Look at the US Dollar Versus the Euro
Dollar-Euro (dollar in euro cents): Three-Month Bar-Chart 
The US dollar dropped yesterday as reports surfaced that suggest that the EU will find a way to help Greece. Prices effectively reached their objectives to the 72.80-73.00 area, and we may see consolidation from here.
http://www.advfn.com/p.php?pid=forexqkchart&curcode1=USD&curcode2=EUR
A Look at the Dow Jones Industrial Average (djia)
Dow Jones Industrial Average: Six-Month Chart
The DJIA gained more than 150 points yesterday, as it looked like the European sovereign debt problems could be remedied, soon. Higher equities prices helped push oil prices higher yesterday.
Source: http://money.cnn.com/quote/chart/chart.html?symb=djia&sid=1643&time=6mo&Submit1=Refresh
A Look at Longer Term Charts
Crude oil prices look heavy on longer-term charts. That can change, but they look like they could test lower levels.
Heating oil prices have broken a longer-term trendline, and that implies possible tests of lower levels.
Gasoline prices are still trading within larger consolidation patterns,
but they, too, look like they could test lower levels at some point.
Recommendations for Specific Market Segments
Heating Oil Distributors Heating oil prices now have support at Friday’s low (182.70), Monday’s low (186.50), and Tuesday’s low (187.47). Yesterday’s advance came as traders bought oil in sympathy with higher equities and a weaker US dollar. While equities and the dollar were and almost certainly will be the biggest factors from which traders take their cues in this market, heating oil prices led the oil complex higher yesterday because of cold weather last week, this week and expected again next week. Sooner or later, all this cold weather is likely to have a positive impact on demand, or at least that is the thinking. While that makes sense, it is worrying because of the lack of diesel demand, which is typically the baseload that allows heating use to give us incremental boosts in consumption. We are still holding capped-price programs as insurance against the kind of rally we had yesterday, which has very little to do with supply or demand, here. Diesel Users We would hold capped-price protection here, without adding more. NYH Ultra Low Sulfur Diesel.…197.25-197.75 plus 3.750 USG Ultra Low Sulfur Diesel.…194.25-194.50 plus 0.625 Jet/Kerosene Users & Airlines New York Harbor cash market differentials were 4.00 to 4.50 cents over January heating oil in NY Harbor and 0.25 under to even with the screen in the US Gulf. Anything under 4 cents is worth hedging. Diesel & Gasoline Marketers We would keep product hedged against lower prices. Gasoline Blenders & End-Users Prices have found support from 181.24 to 187.00, although none of it is strong, yet. We will wait until March to buy (more, next week). Prompt NYH Fuel Ethanol…..187.00-189.00 Prompt USG Fuel Ethanol….178.00-180.00 Quotes from 02-08-10 Heating Oil End-Users We would hold capped-price protection, strictly as a precaution, but we are not going to want to buy until early March (more on that next week, with our Seasonal Reports). Speculators We would hold off on adding fresh positions for now, with a view towards buying in early March (more on that next week). Refiners The 7:5+2 crack spread was $7.37 yesterday. Crude Oil Producers Crude oil prices rallied steeply yesterday in sympathy with stronger equities and weaker US dollar quotes. We will be taking cues from them until Friday, when the DOE report is released. | Prompt Jet Fuel Prices New York Harbor 197.75-198.25 US Gulf 193.50-193.75 Midwest (Group Three) 193.75-195.75 Midwest (Chicago) 190.25-192.25 Los Angeles 199.00-200.00 San Francisco 199.00-200.00 Portland, Oregon 199.00-200.00 Cents per gallon Propane Prices Mont Belvieu……….…..non-TET………$1.346810 Cents per gallon  Gasoline prices rallied yesterday, along with the rest of the complex, and it still has support at 185.19, 184.19, 182.63, and 181.24, so we have a number of support levels beneath this market. Prices would need to break down below all of those, especially 181.24 in order to kick the trend lower into a new gear.
The next few days will be important for this market to establish whether it will move higher from here. At this stage, we have had some short-covering above support. We will have to wait until Friday to see this week’s supply and demand figures from the DOE. |