Energy Complex Heading Higher

The energy complex is heading higher this morning, attempting to recoup from yesterday’s losses, with heating oil futures leading the way with ~2% gains to start the day. The market is looking out for news from Moscow for the back half of this week as an envoy from the U.S. is visiting ahead of Trump’s ceasefire deadline this Friday. Reconciliatory headway is unlikely, however, which is taking credit for the 1.5% rally in oil prices this morning, along with a bullish report from the API.

The American Petroleum Institute published their weekly petroleum status report yesterday afternoon, showing a 4.2 million barrel drop in national crude oil inventories last week. The Institute estimated a 1.6 million barrel build in distillate stocks and a tamer 900,000 barrel drop for gasoline. The Department of Energy’s official report is due out at its normal time this morning (10:30 EDT).

Disturbances in the Atlantic have been forecasted to take a more benign path overnight, increasing the likelihood of the storms, should they develop, staying out to sea. As a reminder, Atlantic hurricane activity typically peaks in September, and this season is expected to be a busy one.

Refinery news:
PBF Energy's Delaware City refinery is working to get its operations back online after two compressor failures caused problems with its hydrotreating and hydrocracking units, one of which caused a release of sulfur dioxide and flaring. Meanwhile, Delek is planning four days of "planned maintenance" on its fluid catalytic cracking unit at its Big Spring, Texas refinery, the same unit that experienced what was only described as an equipment malfunction in July, which slowed rates. Marathon is expecting its Galveston Bay refinery to return to normal run rates soon, completing its recovering from a fire that broke out a couple months ago.