Energy Markets on Steady Course Despite Middle East Tensions; Midwest Prices Surge

The energy complex is off to a slow start this morning with gasoline, diesel, and crude oil contracts trading just on the red side of breakeven. The same contracts are all set to make weekly gains, enough to fully offset last week’s downward move. Ongoing and spreading tensions in the Middle East has been the chief reason cited for this week’s rally, but the bullish DOE inventory report certainly didn’t hurt.

Physical prices in the Midwest surged yesterday as supply concerns surrounding the continued unplanned downtime at the BP Whiting refinery has pushed basis values higher for a fourth day. Gasoline and diesel differentials in the Group 3 and Chicago markets rallied over 20 cents since the beginning of the month, pulling regional prices back from the basement they’ve been trading in since the beginning of last winter.

The spring rally may have come early this year, both regionally and nationwide. RBOB and HO futures are pushing to multi-month highs with more upside left on the charts.

Ousted Fox News host Tucker Carlson interviewed the Russian President last night in what seemed more like the recitation of a monologue rather than a Q&A session. While important topics were touched on, such as the war in Ukraine and American journalist being imprisoned, not much came from the interview other than a propaganda win for the Kremlin.

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