Fueling Strategy: Please fill as needed today, Wednesday AM look for a very small drop in wholesale prices – Be Safe Tonight!

NYMEX Crude $ 35.97 DN $.7900
NY Harbor ULSD $1.1253 DN $.0011
NYMEX Gasoline $1.2567 DN $.0340

NEWS
Crude-oil prices settled under $36 a barrel on Tuesday, marking their lowest settlement in about two weeks, as concerns about an expanding global glut and weak economic data from China weighed on sentiment.

Tensions in the Middle East, another driver of oil’s recent gyrations, have remained high. February West Texas Intermediate crude fell by 79 cents, or 2.2%, to settle at $35.97 a barrel on the New York Mercantile Exchange. Prices, which touched highs above $37 early on in the session, settled at their lowest level since Dec. 21. February Brent crude on London’s ICE Futures exchange fell 80 cents, or 2.2%, to $36.42 a barrel. “Economic concerns ignited by China continue to weigh on financial markets, sweeping the crude complex along with it,” said Matthew Smith, director of commodity research at ClipperData. “After geopolitical tension was unable to lift prices [Monday], a rising dollar is only serving to provide greater headwinds to any sort of rebound” Tuesday.

Oil prices started 2016 with a surge on Monday morning in Asia as escalating tensions between Saudi Arabia and Iran stoked concerns about a possible supply disruption. But worries about oversupply loomed and China reported that its manufacturing sector index fell last month, exacerbating concerns over the outlook for energy demand. “It’s difficult for the market to determine the proper geopolitical price impact” from Saudi Arabia and Iran, said Robbie Fraser, commodity analyst at Schneider Electric. Fraser also said “geopolitical tension tends to add a risk premium to price,” which make the possibility of Organization of the Petroleum Exporting Countries coordination even more unlikely this year.

Traders are also watching escalating violence in Libya, where two oil terminals were attacked. James Williams, energy economist at WTRG Economics, said the potential for conflict in Venezuela as the elected assembly was to meet for the first time Tuesday. A “super majority of the opposition” was elected and President [Nicolas] Maduro is doing all in his power to circumvent the results.”

The oil market will take cues from weekly U.S. crude inventory and production data on Wednesday from the Energy Information Administration. The American Petroleum Institute will release supply figures late Tuesday. Citi Futures estimates a decline of two million to three million barrels from crude stockpiles. Data provider Genscape Inc. recently reported that inventories at the Cushing, Okla., storage hub reached an all-time high for the week ending Jan. 1 and capacity utilization is just 2% below the all-time high set in March 2011.