Fueling Strategy: Please keep tanks topped tonight, Wednesday AM wholesale prices will go UP – Be Safe Tonight!

NYMEX Crude $ 44.90 DN $1.3900
NY Harbor ULSD $1.4229 DN $0.0186
NYMEX Gasoline $1.3765 DN $0.0134

NEWS
Oil futures on Tuesday finished at their lowest level in a week, after the International Energy Agency cut its crude-demand forecast, warning that supply will continue to outpace demand well into 2017.

On the New York Mercantile Exchange, October West Texas Intermediate crude fell $1.39, or 3%, to settle at $44.90 a barrel. The settlement was the lowest since Sept. 6, according to FactSet data. November Brent crude on London’s ICE Futures exchange declined by $1.22, or 2.5%, to $47.10 a barrel, the lowest finish since Sept. 2.

Futures already were trading lower when they took a sharp leg down after the IEA released its closely watched monthly report. The agency downgraded its global oil demand predictions by about 100,000 barrels a day for this year to growth of 1.3 million barrels a day, and cut its forecast for 2017 by 200,000 barrels to growth of 1.2 million barrels a day. “This supply-demand dynamic may not change significantly in the coming months. As a result, supply will continue to outpace demand at least through the first half of next year,” it said in its report.Matt Parry, IEA senior oil economist, told Market Watch that the key takeaway from the report is that global oil demand growth is “slowing very sharply.” Year-over-year demand growth for the third quarter of 2015 was at 2.3 million barrels a day, he said. That is down to growth of 1.6 million in the first quarter of this year, 1.4 million in the second quarter and, “worryingly,” a projected growth of 800,000 barrels in the third quarter of this year, he said.

Based on the forecasts, “both Chinese and European oil demand growth have all but vanished by 3Q16,” said Parry. At the same time, “global inventories will continue to grow: OECD stockpiles in July smashed through the 3.1 billion barrel wall,” the IEA said in its report. “As for the markets return to balance—it looks like we may have to wait a while longer,” it added. “Near record” supplies from the Organization of the Petroleum Exporting Countries is an “issue, as gains in OPEC countries roughly offset losses elsewhere,” Parry said.

Crude has been seesawing between $40 and $50 a barrel for months, given the limited action by major oil states to rein in output. While a meeting in Algiers by OPEC members is scheduled for later this month, many market watchers are skeptical over the prospect of a cap on production levels. “What we’re going to need to see is some serious discipline from the OPEC producers” in order for prices to emerge from their trading range, said Virendra Chauhan, oil analyst at Energy Aspects. “In order to move into that $55 to $60 range, you need to see a change in tone.”

Futures rose during New York trading on Monday, getting a lift from a report from data provider Genscape Inc. that showed storage in tanks in the Cushing, Okla., storage hub fell by more than 1.2 million barrels last week. That follows a government report in the previous week that showed a 14.5 million-barrel drop—one of the biggest one-week declines in U.S. oil inventories on record. Data from the Energy Information Administration due out Wednesday could show a rebound in stockpiles. S&P Global Platts said it expects crude inventories to rise 3.3 million barrels, noting that the prior week’s decline was likely weather related. The American Petroleum Institute will issue its own petroleum-supply data late Tuesday.