Week in Review – July 10, 2020

WTI Crude finished the week lower after cruising to mid-week relatively flat. Demand concerns early in the week were offset by the EIA increasing the 2021 crude demand forecast by 10% which helped lift markets on Wednesday.  While some headlines pointed toward rising prices, the market fell to close the week on mixed inventory news, corporate layoffs, and fears of a surge in coronavirus cases.

This week also brought some important news for oil infrastructure. A judge ruled that the Dakota Access Pipeline, which has been operational for years, must shut down to complete an environmental impact assessment. Although the court later allowed for half of the pipeline to remain open, the company operating the pipe has refused to shut down, claiming the judge does not have the authority to shut an operational pipeline. Facing losses of up to $3.6 million per day, the company is counting on a higher-court appeal to maintain operations this year.

Prices in Review

WTI Crude opened the week at $40.38.  It started the week flat with a small bump based on the EIA increasing the demand forecast for 2021. However, coronavirus fears and a weak jobs report moved the markets lower to end the week. Crude opened Friday at $39.58, down 80 cents (-2.0%).  Crude is continuing to move lower in early trading this morning.

Diesel opened the week at $1.2262. It generally followed crude throughout the week, though with slightly larger peaks and valleys. Diesel opened Friday at $1.2239, a fractional loss (-0.2%).

Gasoline opened the week at $1.2440.  It rose during the week on positive inventory news of a larger than expected draw which was tempered by coronavirus fears to end the week.  Gasoline opened Friday at $1.2484, a fractional gain (-0.4%).