Written on: May 1, 2024

Energy Price Report May 2024

Wednesday, May 1, 2024

Energy Futures Are Extending Their Losses

Energy futures are extending their losses for a third consecutive session for WTI, Brent, and gasoline and to a fourth for heating oil futures, as of this writing in the overnight session on Wednesday.  The losses came amid weakness in US stock market index futures and continued strength in the US dollar, as well as bearish weekly US crude oil stock data from the American Petroleum Institute (API).

Market Traders Looking Ahead to Economic Data

Market traders are looking ahead to US economic data in the form of the ADP Employment Report, the S&P Global and ISM Manufacturing PMIs, construction spending, the US Job Openings and Labor Turnover Survey (JOLTS) and weekly petroleum stock data from the Energy Information Administration (EIA). The FOMC policy announcement is coming up today as well, with the Fed expected to keep interest rates steady.

API Reported Build in US Crude Oil Stockpiles

The API reported a 4.91mb build in US crude oil stockpiles for the week ended April 26, while forecasts called for a 1.80mb draw (average of polls by Reuters and S&P Global). Data for distillates were neutral to supportive as the agency reported a larger than expected draw of 1.48mb (vs 0.88mb) and inventory figures were bullish for gasoline as the API reported a draw of 2.19mb, far above the 0.12mb expectation. An OPIS poll calls for a 2.09mb build in propane and propylene inventories in today’s EIA report.

Overseas Markets

The Shanghai, Hong Kong, and European stock exchanges are closed today for Labor Day. The Nikkei in Japan closed 0.34% lower overnight. In UK news this morning, the final CIPS/S&P Global Manufacturing PMI for April came in at 49.1, beating the 48.7 forecast. The Nationwide House Price Index fell by 0.4% last month, while expectations called for a 0.2% increase in house prices. US stock market index futures were seeing losses of between 0.2% (Dow futures) and 0.6% (Nasdaq futures) as of this writing. Also unsupportive for crude oil prices, the US dollar index continued higher and was up 0.1% this morning.

Refined Products

Refined products weakened yesterday with a rally in the US dollar and losses in global equities. Brent crude lost 54 cents to close at $87.86 a barrel, WTI crude fell 70 cents to $81.93 a barrel, gasoline futures dropped 3.79 cents lower to settle at $2.7108 per gallon, heating oil fell 1.79 cents to close at $2.5134 per gallon and natural gas futures lost 3.9 cents to settle at $1.991 per MMBTU.