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Midwest Spot Products Soar on End-Week Oil Futures Surge
5/19 4:35 PM
Midwest Spot Products Soar on End-Week Oil Futures Surge BURLINGTON, Vt. (DTN) -- Spot market oil product prices in Oklahoma Group 3 and Chicago maintained an upward trek Friday afternoon fueled by a final surge in benchmark June RBOB and ULSD futures to close out a strong week of price action on the New York Mercantile Exchange. Trading was active this morning, but trailed off late day in both heartland cash market arenas. NYMEX oil futures speculators rallied paper prices on optimism the Organization of Petroleum Exporting Countries will extend current production cuts when ministers meet on May 25 in Vienna. An OPEC panel reviewing scenarios for the oil producer group's meeting next week is said to be examining the option of deepening and extending a deal to reduce crude output, OPEC sources said on Friday, intent on reducing out of balance global inventories and supporting prices. Saudi Arabia and non-OPEC Russia have agreed on the need to prolong the current cuts until March 2018, although Saudi Energy Minister Khalid al-Falih said extended curbs would be based on current quota limits. The oil rig count in the United States increased by eight this week to 720, according to oil services provider Baker Hughes, Inc., marking the 18th consecutive week in which rigs were returned to service. Since the start of the year, the industry has added 195 oil rigs, and at 720, the oil rig count is at its highest since April 17, 2015. Canada added seven oil rigs to producing status that boosts the active count to 36, and ranges 20 above the comparable week a year ago. June NYMEX RBOB futures soared 4.6cts to $1.6523 gallon at settlement this afternoon and posted a 7.62cts advance for the week. ULSD futures for NYMEX delivery rallied 9.04cts this week that included a 3.74cts advance to $1.5827 gallon a settlement today. The June West Texas Intermediate crude oil contract ended the day $0.98cts in the plus column at $50.33 bbl, and ended the week up $2.49 bbl. Suboctane 9.0-lb. V-grade regular in Group 3 improved 50pts in cash differential trading at a 7.0cts June futures discount that powered spot price 5.1cts above its Thursday DTN closing market posting to $1.5823 gallon. A-grade premium no lead climbed 6.1cts to $1.8423 gallon rated at a 26.0cts regrade. Chicago 9.0-lb. CBOB was assessed at a 9.25cts MERC discount for third cycle May generic pipeline delivered supply that boosted spot price by 4.35cts to a notional $1.5598 gallon. High-octane PBOB remained at a 32cts CBOB premium, and RBOB was rated 12cts over CBOB for prompt trade. Group 3 X-grade ultra low sulfur diesel fuel rode the futures rally up 4.09cts to an implied $1.5802 gallon talked either side of a 0.25cts June futures discount for offline Magellan Pipeline delivery. Ultra low sulfur diesel fuel in Chicago was notionally rated a penny below the June ULSD futures print for third cycle May generic pipeline delivery that moved spot price up 3.49cts to $1.5727 gallon. G. Bud deGorgue, 1.802.524.1784, bud.degorgue@dtn.com, www.schneider-electric.com. (c) 2017 Schneider Electric. All rights reserved.