Fueling Strategy: Please partial fill only tonight, Saturday AM wholesale prices will drop 3.5 cents – Be Safe Tonight!

NYMEX Crude $ 44.19 DN $.0056
NY Harbor ULSD $1.3570 DN $.0137
NYMEX Gasoline $1.3615 UP $.0065

NEWS
Oil futures settled on Friday at their lowest level in about 11 weeks, as prospects for Libyan crude supplies added to this week’s concerns that a glut of oil products will cut demand for crude by refiners. Data released Friday afternoon showing a fourth-straight weekly rise in the number of active U.S. rigs drilling for oil contributed more pressure on prices.

September West Texas Intermediate crude declined by 56 cents, or 1.3%, to settle at $44.19 a barrel on the New York Mercantile Exchange. Based on the most-active contracts, prices settled at their lowest level since May 9, according to FactSet data. They were down about 3.8% from the last Friday’s settlement of the August contract, which was the front-month contract at the time. September Brent crude on London’s ICE Futures exchange lost 51 cents, or 1.1%, to $45.69 a barrel, with prices down by about 4% for the week.

Baker Hughes said the active U.S. oil-rig count was up 14 to 371 as of Friday. The size of the increase was more than double a six-rig rise reported a week earlier. With the “rig-count bottoming” and the market approaching the peak of the summer-driving season, some oil investors are “reticent to be long oil in the near term,” said Justin McNichols, chief investment offer at Osborne Partners Capital Management. Meanwhile, a stronger dollar and ongoing supply-glut fears continued to keep pressure on oil.

“As inventories remain well above year-ago levels for crude and gasoline, and as demand fails to be as strong as [some] hope, there is the fear that the ongoing oil and gasoline glut is turning its attention to distillates, as refiners chase profit margins and adjust production to optimize diesel output,” Matt Smith, director of commodity research at ClipperData, told MarketWatch. Recent data released show inventories of gasoline are growing globally. Despite being in the midst of the annual driving season, U.S. gasoline stocks grew by 900,000 barrels to 241 million barrels, gaining for four out of the last five weeks. On Nymex, August gasoline rose less than a cent to $1.362 a gallon, for a weekly loss of 4.3%, while August heating oil lost 1.4 cents, or 1%, to $1.357 a gallon, down 2.9% for the week. In China, gasoline production will outrun demand by 9% this year, said energy research firm ICIS.

Tim Evans, a Citi Futures energy analyst, noted that Libya has the potential to produce more than 320,000 barrels a day, having averaged as much as 1.6 million barrels a day in the past. “The odds on restoring production may remain long, although the UN-backed unity government has made some progress toward combating Islamist militants to regain control of the oil export terminals necessary to provide an outlet for oilfield production,” he said.

Investors are also monitoring developments in Nigeria where the country’s oil infrastructure has come under multiple attacks by a militant group. Reports say the government is in talks with the rebels known as the Niger Delta Avengers.