The bull market continues for energy futures as all of the big 4 petroleum contracts broke through to fresh 3.5 year highs overnight.  Yesterday’s DOE report had some bearish news for domestic crude prices, but enough bullish data points for refined products to erase the early sell-off attempt, and that momentum has carried through to this morning.

While the issues surrounding Iran and Venezuela seem to have the market underpinned, a report yesterday by Morgan Stanley suggested that the upcoming change in Marine diesel specs could push oil prices past the $90 mark.  A year ago when oil was still trading in the mid $40s that may have seemed a lofty proposition, but with Brent breaking through $80 overnight that potential now seems quite real.

Notable items from the DOE weekly report:

US crude production set yet another record north of 10.7 million barrels/day.

Crude oil exports also set a record north of 2.5 million barrels/day.

PADD 2 (Midwest) refinery throughput rates passed the 4 million barrel/day mark for only the 3rd time ever, and are poised to smash the record rates set last summer as plants finish up their spring maintenance.

PADD 3 refinery runs are far below the past 2 years owing to a late maintenance period and some unplanned downtime.  Those rates should start ramping back up soon, and when they do, that might be the best chance for a fundamental argument to end the bull run.

CLICK HERE for a PDF of today’s charts