Fueling Strategy: Please keep tanks topped, tonight before 23:00 CST fuel again, Thursday AM wholesale prices will jump UP over 6 cents – Be Safe!!

NYMEX Crude $ 47.81 DN $.7200
NY Harbor ULSD $1.5796 DN $.0319
NYMEX Gasoline $1.3900 DN $.0462

NEWS
Oil futures logged their first loss in four sessions on Wednesday after a U.S. government report revealed an increase in weekly crude inventories along with a climb in domestic production.

On the New York Mercantile Exchange, November West Texas Intermediate crude lost 72 cents, or 1.5%, to settle at $47.81 a barrel, after spending the session switching between gains and losses. Prices had tallied a more than 8% in the last three sessions. November Brent crude on London’s ICE Futures exchange fell 59 cents, or 1.1%, to $51.33 a barrel.

The U.S. Energy Information Administration reported on Wednesday an increase of 3.1 million barrels in crude supplies for the week ended Oct. 2. Analysts polled by Platts expected supplies to be up by 1.75 million barrels, while the American Petroleum Institute Tuesday said inventories fell 1.2 million barrels. The EIA’s reported increase comes on the heels of a fall in oil-refinery activity, which tends to lower demand for crude. The data also showed that total domestic production reached 9.17 million barrels a day, up 76,000 barrels from a week earlier. Output for the lower 48 states was at nearly 8.69 million barrels a day, up 58,000 barrels. Sentiment and speculation had “reached relatively oversold extremes,” setting up Tuesday’s rally, but rising domestic production and rising inventories put pressure on the oil market Wednesday, said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management. The EIA data indicate “market fundamentals remain bearish and prices should remain under pressure,” he said. Gasoline supplies climbed by 1.9 million barrels, while distillate stockpiles fell 2.5 million barrels last week, according to the EIA.

On Tuesday, the EIA, in a monthly outlook report said U.S. crude production fell 120,000 barrels a day in September from a month earlier and forecast that output would decrease through mid-next year. That helped lift WTI prices Tuesday by 4.9% to their highest settlement level in five weeks. News that the Organization of the Petroleum Exporting Countries predicted big cuts to oil investments that are expected to ease output and cut global crude supplies also helped.

Oil prices have been supported this week by reports that Russia, one of the top crude producers in the world, has expressed willingness to meet with nonmembers and OPEC members to discuss market conditions. “The market is comforted to see there appears to be more willingness among the major oil producers in [OPEC] to work together, especially with the smaller players, but a rebalancing is still quite a distance away,” said Vyanne Lai, an energy analyst at National Australia Bank. Given the vulnerability of the market, prices could still drop near the lower $40s at any sniff of bad news, she said.

Next for the oil market is the return of Chinese traders Thursday after the National Day Golden week holiday, “which should provide some indication of growth in China and potential risks to global markets,” said Haworth.