Market Close: May 04 Mixed
May 4th, 2023 by loren
Fueling Strategy: Please fuel as needed today/tonight prices are down almost 10 cents and Friday look for another 5 to 6 cent drop~Be Safe
NMEX Crude $ 68.56 DN $.0400
NYMEX ULSD $2.2387 UP $.0064
NYMEX Gas $2.3259 UP $.0038
NEWS
Crude oil and gasoline prices Thursday settled mixed, with crude falling to a 5-month low. A stronger dollar Thursday weighed on energy prices. Crude oil prices also fell on concern that the ongoing U.S. banking turmoil and the Fed’s rate hikes will slow the economy and energy demand. The Fed raised interest rates by 25 bp Wednesday, and the ECB raised rates by +25 bp Thursday and signaled more rate increases are coming. Crude prices rebounded from their worst levels on signs of strength in Chinese fuel demand.
Thursday’s global economic news was weaker than expected and was bearish for energy demand. U.S. weekly initial unemployment claims rose +13,000 to 242,000, showing a weaker labor market than expectations of 240,000. Also, the Eurozone Apr composite PMI was revised downward by -0.3 to 54.1 from the initially reported 54.4. In addition, the China Apr Caixin manufacturing PMI fell -0.5 to 49.5, weaker than expectations of no change at 50.0.
Crude oil prices are also being undercut by signs that Russia has not delivered on its threat to cut crude output. Tanker-tracking data from Bloomberg shows Russia’s crude exports jumped above 4 million bpd in the week of April 28. Russia has halted the publication of crude and condensate production data in an attempt to disguise if it has actually cut crude output.
Baker Hughes reported last Friday that active U.S. oil rigs in the week ended April 28 were unchanged at 591 rigs, moderately below the 2-1/2 year high of 627 rigs posted on December 2. U.S. active oil rigs have more than tripled from the 17-year low of 172 rigs seen in Aug 2020, signaling an increase in U.S. crude oil production capacity.
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