Energy Complex Selling Off After Seeing Heavy Buying
The energy complex is selling off this morning after seeing heavy buying yesterday. The White House announced a delay in the implementation of a 10% tariff on Chinese manufactured consumer goods (electronics, toys, etc.) in order to keep from disincentivizing a strong holiday season for businesses and shoppers. The news incited a strong stock market rally and with it gains of over 7 cents to each refined product prompt month futures contracts and $2.50-$3.00 to both US and European crude oil benchmarks.
Both equity and energy prices are pulling back this morning, each giving back half, if not most, of yesterday’s gains. Equities traders are running for the exit as the it was reported that the 10/2 year treasury yield curve has inverted this morning, signaling a recession might be on the horizon. That, combined with the API’s surprise build in crude oil stocks last week, has sent energy futures sharply lower. RBOB and HO prices are down about 4 cents to start the day with WTI down $1.50 in lock-step.
Renewable Identification Number prices seemed to have stabilized after the EPA granted 31 small refinery waivers earlier this week. The news took RINs down to a new 2019 low around 11.5 cents.