Awaiting Meetings Between US And Russian Leaders Energy Markets Remain Mixed

Friday’s trading kicks off with another quiet and mixed session for energy markets as the world anxiously awaits today’s meeting between the U.S. and Russian leaders.

RBOB and ULSD futures are trading places this morning with gasoline futures leading the complex in modest losses while diesel prices were barely hanging on to a few points worth of gains, basically in opposite fashion of the price action we saw yesterday.

Details remain scarce on the restart timing of the P66 Bayway refinery FCC unit that was shut following a fire earlier this week but given the pullback in RBOB futures this morning and muted reaction in NYH basis markets, it appears that traders expect the downtime to be short-lived.

The latest forecast tracks for Erin have been favorable for Puerto Rico, the Virgin Islands and the East Coast as the storm looks to be shifting north and east, keeping it far enough offshore to avoid major impacts. High seas and heavy rains from the first major hurricane of the season are still a possibility that will throw a wrench in waterborne logistics next week.

On the other hand, the forecast for the storm system known as AL98 are also shifting East, which is bad news for Texas as that movement will bring more heavy rains to the region. The storm should be moving onshore later today and (probably) won’t have time to build enough to get a name, but there is now a non-zero probability that the Corpus Christi area refineries could see flooding rains and power outages, whereas 2 days ago this system was expected to head west into Mexico and be a non-event.

California’s Energy Commission delayed a vote this week to decide on previous plans to cap refinery profits in the wake of the state’s nightmare awakening to those facilities shutting their doors. No word yet if the state may try implementing a plan to cap those refinery losses.