WTI, RBOB, and ULSD Futures Are All Trading About 2% Lower So Far This Morning

Energy prices are trading lower so far this morning after finishing their fourth straight weekly decline last Friday. That nasty “R” word is starting to resurface on the back of a disappointing jobs report, showing the US economy to be slowing faster than anticipated, tanking stocks in the Asian exchanges and US equity futures this morning. Prompt month WTI, RBOB, and ULSD futures are all trading about 2% lower so far this morning.

Hurricane Debby made landfall as a category 1 storm early this morning near Florida’s Big Bend region, despite forecasts calling for it to hit the mainland as “just” a tropical storm. There seems to be little in the way of Debby’s immediate path in terms of energy infrastructure, but there are a slew of terminals in Georgia and South Carolina that could be at risk of flooding if this slow-moving system hops across the peninsula and hugs the Southern Atlantic coastline. Savannah and Charleston are both at risk of receiving as mush as 30 inches of rainfall in the next 48 hours.

Baker Hughes reported a drop in active oil rigs last week, bringing the total to 586 across the US.

We’re seeing a repeat of last week on the CFTC’s Commitment of Traders report. The Money Manager’s net position in all of the five major petroleum futures contracts dropped by a cumulative 116,000 contracts last week, painting a very bearish picture of what the ‘smart’ money expects in the near term.