Gasoline Prices Are Hovering Near Break-Even Levels This Morning After Adding Nearly 20 Cents During Last Week’s Run

Diesel futures are leading the energy complex lower Monday after going 5 for 5 with gains every day last week that added 30 cents to prompt values and pushed prices across the country to a 3-month high. While a corrective pullback is not unusual following that type of rally and so far, this nickel decline doesn’t change the bullish technical outlook that should have prices testing the $3 mark again soon. 

Gasoline prices are hovering near break-even levels this morning after adding nearly 20 cents during last week’s run. Even though demand has been sluggish to start the year, RBOB futures still seemed poised to have a typical spring rally that would push prices into the $2.60-$2.80 range.

Money managers are continuing to have a hard time timing this market, slashing long positions and adding new shorts across the energy complex in the latest CFTC report, which means many missed out – or were run over by – last week’s big rally. 

The Baker Hughes count of active oil rigs in the US held steady at 499 for a 2nd straight week, while natural gas producers increased their count by 4 to 121. While the rig count has been lackluster of late, the consolidation of Permian basin operators continues with Diamondback energy buying the largest private operator in the basin Endeavor Energy for $26 billion. 

The attacks on shipping in the Red Sea continued over the weekend and the Houthi’s seemed to be having a hard time picking targets, as an Iranian-bound cargo ship was said to be hit.  

In refinery upset news: 2 more Russian refineries were hit by drone strikes on Friday, P66 had a fire at its Billings MT facility, and multiple LA-area facilities reported unplanned flaring over the weekend following last week’s deluge and a Reuters article highlighted the complicated process of trying to auction off Citgo’s assets.

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