Energy Futures Stand On Green Side Of Flat
Energy futures seem content to stand on the green side of flat this morning with diesel and heating oil adding .4% while gasoline lags with a muted .05% gain to start the day. Uncertainty surrounding the pandemic and the lack of news on nuclear talks with Iran have left energy prices drifting, not to mention most traders snoozing yesterday’s inventory report.
The Department of Energy published a ~600k barrel build in total U.S. crude oil inventories, a slight, sub-100k build in gasoline stocks, and, the big mover of the day, a draw of one million barrels of ULSD. Given the current landscape, demand estimates for both refined products are likely studied more thoroughly than the headline values: diesel demand was off 6.6% on the week while gasoline saw an increase of 1.8%.
Ethanol inventories take another step below their seasonal five-year low as a combination of increased blending and rocketing corn prices take credit for the drawdown. We could see this low-supply and high-price worsen in the short term as vaccine rollouts across the nation have people driving again.
The POTUS has committed the nation to cutting our carbon footprint by 50% more than our initial 2005 goal. The ambitious, if a bit lofty, objective sounds great in headlines but similar statements have been made in the past only to be undone by a future administration.