Fueling Strategy: Please keep tanks topped tonight, Friday AM wholesale prices will go up 2.5 cents – Be Safe

NYMEX Crude $ 44.32 UP $.9800
NY Harbor ULSD $1.4545 UP $.0252
NYMEX Gasoline $1.4018 UP $.0028

NEWS
Oil futures climbed Thursday, with the U.S. benchmark extending its win streak, thanks to a third consecutive weekly decline in domestic inventories and a weaker dollar.

Natural-gas futures, however, retreated from a 20-month high as cooler U.S. weather forecasts hurt demand expectations.

On the New York Mercantile Exchange, November West Texas Intermediate crude rose 98 cents, or 2.2%, to settle at $46.32 a barrel, its highest since Sept. 8. That marked a fourth-consecutive session climb for WTI. For the week so far, the contract is trading more than 6% higher. November Brent crude on London’s ICE Futures exchange rose 82 cents, or 1.8%, to $47.65 a barrel, for a second straight session gain. It settled at its highest since Sept. 12.

Prices rallied by 2.9% on Wednesday after data released by the U.S. Energy Information Administration showed a bigger-than-expected 6.2-million barrel fall in domestic crude stockpiles for the week ended Sept. 16. At 504.6 million barrels, crude inventories were the lowest since Feb. 12, but still 11% above year-ago levels, said EIA. “Relatively strong refinery activity for this time of year has put downward pressure on crude stocks,” said research firm S&P Global Platts, noting crude runs last week at 16.6 million barrels a day was 941,000 barrels a day higher than the five-year average. The refinery utilization rate reached 92%.

Weakness in the ICE U.S. Dollar Index following the Federal Reserve’s decision to hold off on raising interest rates on Wednesday, also supported dollar-denominated oil prices.

“While the crude oil market is responding well following the bullish inventory number [Wednesday] and the Fed leaving their benchmark rate unchanged, we are still in a position where fundamentals are poor,” said Tim Evans, chief market strategist at Long Leaf Trading Group., adding that talk will soon shift back to the coming rate increase. “Our view is this relief rally is cleaning up some of the excessive bearish speculation that has been in the market and this is creating a selling opportunity for energy investors,” he said. Production from the Organization of the Petroleum Exporting Countries has grown in recent months owing to record Saudi Arabian production and increases by Iraq and Iran, while more is also expected from Libya.

Outside OPEC, total U.S. output also climbed by 19,000 barrels a day last week to 8.512 million barrels a day, according to the EIA. Weekly stockpiles for gasoline dropped more than expected, while distillates unexpectedly rose.

On Nymex Thursday, October gasoline added less than half a cent $1.402 a gallon, while October heating oil tacked on 2.5 cents, or 1.8%, to $1.454 a gallon.

“Bottom line, the long-term fundamentals, specifically the stabilizing U.S. [oil] production figures, remain a headwind on energy futures as the market remains well supplied and there continues to be a production surplus globally in the absence of any effective OPEC policy,” analysts at The 7:00’s Report said Thursday. “So, with the time frame of that surplus coming into balance continuing to be pushed back, the outlook is fundamentally bearish,” they said. But for now, “the recent string of unexpected supply draws in the EIA data ahead of the International Energy Forum next week in Algeria will help keep oil prices “afloat until month end.” OPEC members will meet on the sidelines of the forum Wednesday to discuss measures to stabilize prices. Many market watchers remain skeptical of any real action given the longstanding tensions within the group. “Those who are banking on OPEC to cut or freeze production really should stop dreaming, ”a Chinese fuel-oil trader based in Singapore said bluntly.