Fueling Strategy: Please fill as needed tonight, Wednesday AM we’ll see a small drop in wholesale prices of 1.25 cents then Thursday AM 7 cents – Be Safe Tonight!

NYMEX Crude $ 27.94 DN $1.7500
NY Harbor ULSD $ .9749 DN $0.0715
NYMEX Gasoline $ .8989 DN $0.0572

NEWS
Oil futures finished lower on Tuesday for a fourth-straight session, as lower price outlooks for this year and forecasts for a persistent global glut of supplies sent West Texas Intermediate crude back under $28 a barrel. March West Texas Intermediate crude lost $1.75, or 5.9%, to settle at $27.94 a barrel, after earlier attempts to rebound. Prices have now tallied a lost of more than 13% in four sessions. Based on the front-month contracts, they ended at their lowest level in nearly three weeks. April Brent crude on London’s ICE Futures exchange sank $2.56, or 7.8%, to $30.32 a barrel.

The U.S. Energy Information Administration cut its 2016 forecasts for West Texas Intermediate and Brent crude prices in a monthly report issued Tuesday. The government agency said it expects WTI prices to average $37.59 a barrel this year compared with a previous forecast of $38.54. The EIA also said it expects Brent crude to average $37.52 a barrel this year, compared with a previous forecast of $40.15. “Continuing increases in global oil inventories are expected to keep oil prices under $40 a barrel through August,” said Adam Sieminski, EIA administrator, in a statement. He also said that the increases in U.S. oil inventories, which have now topped 500 million barrels for the first time since 1930, will continue and may peak this year at 517 million barrels in April.

For 2017, the EIA raised its outlook for WTI to $50 from $47, while leaving the Brent forecast at $50. The government agency also reduced its 2016 U.S. oil output forecast to 8.69 million barrels from 8.73 million barrels. In a separate report Monday, the EIA forecast oil output from major U.S. shale plays to fall by 92,000 barrels a day in March from February.

Oversupply to widen
Meanwhile, a monthly report from the International Energy Agency essentially stuck to a bearish forecast that crude demand for this year won’t grow more than 1.2%. “We haven’t really changed things very much; the only takeaway of note being that the forecast oversupply has widened,” Matt Parry, senior oil analyst at the Paris-based International Energy Agency, told MarketWatch. With a “relatively conservative” OPEC supply forecast of 32.7 million barrels a day throughout 2016, the net oversupply averages a “huge” 2 million barrels a day in the first quarter and 1.5 million barrels a day in the second quarter, before easing to 0.3 million barrels a day in second half of the year, he said. This is “with OPEC supplies pegged roughly where they are today—add in an extra 0.5 [million barrels a day] of Iranian supplies, and the picture deteriorates still further,” said Parry. Worries about tightening U.S. storage for crude has exacerbated concerns over the oil market.

Gasoline price drops
Back on Nymex, March gasoline lost 5.7 cents, or 6%, to 89.90 a gallon, continuing to trade at its lowest levels since December of 2008. At the retail level, GasBuddy.com reported that the “cheapest gasoline prices in over 12 years are showing up in some lucky states in the heart of the nation,” including Oklahoma and Indiana. The “previously unthinkable 99-cent gasoline [is] becoming a strong possibility as wholesale gas prices plunge amidst growing supply,” it said. Oil refiners are offering bargain prices “to rid themselves of winter-spec gasoline ahead of a pending shift to cleaner burning fuel.”