Tuesday, March 12, 2019
Crude oil and refined products futures are seeing gains of under 1% on Tuesday, amid strength in global stocks following encouraging economic news out of Britain and some weakness in the US dollar as Sterling appreciated. Meanwhile, Venezuelan crude oil exports remain impeded by US sanctions.
Reuters reports that Citgo and Valero are trying to return 2 million barrels of PDVSA oil that was loaded before US sanctions were announced, and that Chevron has been trying – unsuccessfully – to legally make payment on 4.3 million barrels of crude oil that it received. The Guaido administration has yet to set up bank accounts that could receive oil payments. PDVSA exports are also hampered by a long power outage, which as impacted operations at Venezuela’s primary crude oil export terminal at Jose port.
Global stocks were seeing some strength this morning after Brussels agreed to a tweaked Brexit plan from British Prime Minister Theresa May. It was unclear how well the plan would fare with the British Parliament, however. GDP growth for the UK came in at 0.5% in January, topping the Econoday consensus forecast at 0.2% and industrial production growth of 0.6% was also well above forecasts at 0.2%. The Sterling was appreciating, and the US dollar index was falling, which is supportive for dollar-denominated oil prices.US stock market index futures pointed to modest gains at the open.
Crude futures posted gains of 1.3% yesterday amid commentary from Saudi Arabian Energy Minister Khalid al-Falih, indicating the US could top Russia as an oil exporter over the next five years as output is seen growing by 4 million barrel per day. Brent crude gained 84 cents yesterday, settling at $66.58 a barrel, WTI crude climbed 72 cents higher to close at $56.79, gasoline futures gained 2.34 cents to settle at $1.8260 per gallon, but heating oil weakened 56 points and closed at $1.9942 and natural gas futures dropped 9.3 cents end the day at $2.772 per MMBTU.