The oil complex is heading higher this morning supported by large draws in crude stocks reported by the API. Crude traded higher during yesterday’s session, closing the day up 73 cents. However, crude saw some after-hours losses due to the September contract expiring and the October contract taking the stage. This morning, crude is continuing the upward trend gaining over a dollar (1.8%) to trade at $67.02.
Fuel prices have also made major gains this morning. Diesel gained just under a penny yesterday while gasoline traded mostly flat. Products have increased momentum this morning with diesel picking up another 3.3 cents (1.5%) to trade at $2.1570 and gasoline up 3.5 cents (1.7%) at $2.0529.
The API report was supportive for markets yesterday. Crude drew by 5.2 MMbbls, exceeding the market’s expectation. Yet again, gasoline drew while diesel built, bringing products to a net draw of .9 MMbbls for the week. Cushing stocks saw a small build of .2 MMbbls. The market is anticipating the EIA report coming out later this morning to confirm these numbers.
A weakening dollar is also providing some support for crude prices. President Trump stated he was “not thrilled” with the Federal Reserve’s interest rate increase. Rhetoric about the Fed’s policies continues to rattle investors, sending the dollar lower for the sixth day in a row. The DXY index fell has fallen 0.5 points, retracing its gains since the beginning of the month.