Oil Prices Surge Ahead of Contract Expiration, Weighed Down by Gasoline Market

Strategic Insights -

In a pivotal move just before the expiration of the September light, sweet crude oil contract on the New York Mercantile Exchange (Nymex), oil prices jumped 24 cents per barrel in New York on Wednesday. However, the gasoline market suffered as a result, failing to capitalize on the bullish American Petroleum Institute (API) and Energy Information Administration (EIA) stock data. The settlement of the September contract at $13.16 per barrel was a direct consequence of the book-squaring, which left the gasoline market reeling.

Key Takeaways:

  • The American Petroleum Institute (API) and Energy Information Administration (EIA) stock data was neutral for crude, with the book-squaring leading to a settlement of $13.16 per barrel.
  • Crude stocks declined by 600,000 barrels, while gasoline stocks fell by 2.3 million barrels, according to the EIA data for the week ended August 14.
  • The refinery utilization rate moved up 1.0 percentage point to 99.9% of capacity, as reported by the EIA.
  • The September Nymex gasoline contract fell 0.62 cents to 40.66 cents per gallon, despite the API data showing a bigger gasoline stock draw.
  • Some traders have given up on gasoline as summer winds down, according to Victor Yu, vice president with Refco.
  • The heating oil market closed at 34.03 cents per gallon, down 0.07 cents.
  • Natural gas spot prices edged up 2 cents-3 cents in Louisiana but fell 3 cents in South Texas due to a lack of fundamental support.

Statistics:

  • Crude stocks declined by 600,000 barrels according to the EIA data for the week ended August 14.
  • Gasoline stocks fell by 2.3 million barrels, according to the EIA data for the week ended August 14.
  • Distillate stocks edged up by 800,000 barrels, according to the EIA data for the week ended August 14.
  • The refinery utilization rate moved up 1.0 percentage point to 99.9% of capacity, as reported by the EIA.
  • The September Nymex gasoline contract fell 0.62 cents to 40.66 cents per gallon.
  • The heating oil market closed at 34.03 cents per gallon, down 0.07 cents.

Sources:

  • American Petroleum Institute (API)
  • Energy Information Administration (EIA)
  • Refco (Victor Yu)