Energy prices continue their struggle for direction this week after yesterday’s DOE report had a little something for everyone, and the bullish trend lines started in July managed to hold up through another attempted sell-off.
For the 2nd straight day the complex attempted to sell off heavily mid-morning, despite inventory draws across the board. Just as we saw Tuesday, the buyers stepped up in the afternoon and pushed most contracts into positive territory by the close. That push leaves the technical indicators generally more bullish, although most short term studies are in neutral ground, suggesting we may consolidate for a bit longer before the next push higher. The $48.5-$50.5 range seems to be the battle-ground near term that will decide the direction of our next big move.
The DOE’s weekly gasoline demand estimate reached an all-time high at 9.842 million barrels/day, while gasoline production held steady close to 10.3 million barrels/day as US refiners maintain their record-setting pace for annual throughput rates. Gasoline and crude oil exports dropped on the week, but remain above previous years’ levels, while diesel exports grew, but remain in the range we’ve come to expect over the last several years.
Gulf coast forward basis values finally saw some selling for the first time in weeks yesterday suggesting the race to lock up export barrels – whether they be destined for Mexico, South America or Europe – may have finally reached a stopping point. Reports now suggest that the Shell Pernis refinery – Europe’s largest – won’t be back online for at least a couple more weeks, while the Salina Cruz refinery in Mexico is beginning its restart.
Today’s interesting read on the efforts Google is making to tackle the energy storage conundrum.
Charts from the DOE weekly status report: