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Market Close: May 24 Up

Fueling Strategy: Please fuel as needed today/tonight – Be Safe Today
NYMEX Crude    $ 66.05 UP $2.4700
NYMEX ULSD     $2.0420 UP $0.0538
NYMEX Gas       $2.1177 UP $0.0492
NEWS
Oil climbed the most in a month after Iran said that gaps remain in negotiations aimed at reaching a deal to end U.S. sanctions on its crude. Futures rose 3.9% in New York on Monday with added support from a weaker dollar, which makes commodities priced in the currency more attractive, and a rally in U.S. equities. Iran said there are still differences around the timing of when countries will return to compliance with the original 2015 nuclear agreement, allaying some concern about a rapid ramp-up in the Persian Gulf nation’s output.

While the market is anticipating the Islamic Republic’s supply will pick up again by late summer, the demand recovery will be strong enough to absorb it, Goldman Sachs Group Inc. said. The bank expects Brent futures to hit $80 a barrel in the next few months. “Seasonally we’re coming into a strong demand period, overwhelming concerns on supply,” said Peter McNally, global head for industrials, materials and energy at Third Bridge. With the U.S. continuing to reopen, air travel picking up and Europe lifting pandemic-driven lock downs, “it’s more than likely those barrels can get absorbed.”

Talks between Iran and world powers will continue in Vienna this week to resolve outstanding issues. As part of that process, Iran extended a United Nations nuclear inspections agreement, buying diplomats time to revive the landmark deal that would usher in an official return of the Persian Gulf nation to world oil markets. “Statements over the weekend in the time between the expiration of the old monitoring agreement and the signing of the new deal made it clear that the sense of optimism (over a deal) that was pressuring prices last week was probably overdone,” Bob Yawger, head of the futures division at Mizuho Securities, said in a note. “There is still a lot of work that needs to be done before a final agreement is finished.”

Global benchmark crude has been largely stuck between $60 and $70 a barrel since March, with concern about returning output and Covid-19 flare-ups counterbalanced by the demand recovery underway in some key markets. Virus cases in the U.S. were below 30,000 every day last week for the first time since June, and drivers are taking to the road again in parts of Europe, helping boost demand in the region.

The discount for U.S. benchmark crude futures against Brent shrank on Monday to its narrowest since the end of November on a settlement basis. The smaller that discount becomes, the less attractive U.S. crude exports are to foreign buyers.

Have a Great Day,
Loren R Bailey, President
Fuel Manager Services Inc.
“Serving the trucking industry since 1992”
Office: 479-846-2761
Cell: 479-790-5581
www.FuelManagerServices.com
www.owneroperatoradvisoryservice.com
“To give real service you must add something which cannot be bought or measured with money, and that is sincerity and integrity.”
Categories: Fuel News
loren: Fuel Manager Services Inc. "Serving the trucking industry since 1992" I've been in and around the trucking industry for 45-years beginning in owner operator operations at Willis Shaw Express. I bought a small trucking company that I ran for 6-years then sold and went to work for J.B. Hunt Transport in 1982. After 10-years with Hunt, I started Fuel Manager Services, Inc., we are in our 29th year of serving the American trucking companies. Our simple goal was and is to bridge the gap between the trucking companies and the fuel suppliers.