It’s a mixed start for energy markets Wednesday as traders appear to be keeping one eye on inventory reports and the other on the winter storm, all while trying to pretend they don’t see the latest White House drama roiling the stock market.
So far energy futures seem to be shrugging off a weak overnight session for US equity futures as stocks react negatively to the sudden resignation of the President’s top economic advisor as it suggests more turbulence on international trade may be coming. The two asset classes have been moving together more often than not lately, so today’s action should be a good test to see if oil can go its own way or if fear will once again get a grip on both markets.
The API was said to report a build in crude oil inventories of 5.66 million barrels that has kept WTI and Brent under pressure through the overnight session. Gasoline stocks were said to show a decline of 4.5 million barrels helping RBOB futures hang on to small gains this morning, while diesel stocks built by 1.5 million barrels and ULSD futures have held in the red ever since. The DOE report is due out at 9:30am central.
While there haven’t been any announcements on the RFS since the two White House meetings last week, RIN markets are acting as though a change is coming with values dropping to their lowest levels since last May.
A few good reads coming from the CERAWeek conference.