After hefty early morning gains yesterday, that market turned lower to end the day flat with Wednesday’s close. This morning, prices are dipping lower despite supportive inventory data from the EIA. Crude oil this morning is trading at $55.47, down 83 cents from yesterday’s close.
Fuel prices are also taking a hit this morning. Diesel prices are trading at $1.8677, down 2.1 cents since yesterday. Gasoline is trading at $1.5418, down 0.4 cents.
The EIA’s report yesterday showed across-the-board draws in petroleum product inventories, with a headline crude draw of 4.8 million barrels. Gasoline and diesel stocks both fell by roughly 2.5 million barrels, assisted by declining refinery utilization. Despite the bullish data, markets focused instead on declining gasoline demand, which was down over 400 kbpd from last week to 9.5 MMbpd. As we exit the summer demand season, expect to see weakened gasoline demand, which will suck some of the strength from crude prices.
Looking at the fueling impact of Hurricane Dorian, both Florida and Georgia have quickly sprung back to normal operations now that the storm has passed. But the storm continues making its way up the East Coast, pummeling North Carolina before continuing north towards Eastern Canada. In the Carolinas, 350,000 homes and businesses are without power, so it will take time to restore electric lines once the storm has passed.