Crude Oil --
June 13 WTI crude moved sharply higher today opening at $93.99 and moving as high as $96.04. The contract ended the session at $95.44 today with bulls next target at $98.00. A move above that level would open upside action to $99.52. A drop below $95 even would suggest downside potential to $93.75.
Brent futures moved higher as well, topping out today at $104.82 before setting itself on a path of downtrending resistance. An upward violation of $104.50 could signal upside potential to $104.82, but the technicals suggest sideways movement ahead. Next support lies at $103.50.
According to EIA, the growing supply of domestic light crude oil in the mid-continent that has traditionally moved through the Cushing, Oklahoma, market hub has already prompted both midstream and downstream changes. Pipelines like Seaway that were once used to carry imported oil up from Gulf Coast ports to reach Midwest refiners have been reversed and are moving inland crude oil down to the Gulf, and their capacity is being dramatically expanded. New pipeline infrastructure is also under construction, including the southern portion of the Keystone XL project, which is slated to be in operation by year-end, and more has been proposed.
There have also been major developments in rail transport, where shipments of crude increased dramatically in 2012 compared to 2011. Rail is generally more costly than pipelines for crude oil transport, but unit train loading and unloading facilities, which can often be built quickly and without many regulatory hurdles, can help to narrow the gap between rail and pipeline shipment costs. Rail also can provide greater flexibility in destination points. Rail shipments to take advantage of these opportunities have already begun, and are likely to increase significantly in the near future.
The U.S. average retail price of regular gasoline decreased two cents to $3.52 per gallon as of April 29, 2013, down 31 cents from last year at this time. Prices were lower in all regions of the nation except the Midwest, where the price increased less than a penny to remain at $3.55 per gallon. The largest decrease came on the West Coast, where the price declined four cents to $3.80 per gallon.
The national average highway diesel fuel price decreased four cents to $3.85 per gallon -- 22 cents lower than last year at this time. The largest decrease came on the Gulf Coast, where the price decreased five cents to $3.76 per gallon.
Farm Diesel moved slightly lower in the Inputs Monitor Regional Index, falling $0.029 to an average of $3.473/gallon.
According to EIA, total U.S. inventories of propane increased 1.5 million barrels last week to end at 40.5 million barrels, but are 8.0 million barrels (16.6 percent) lower than the same period a year ago. The Midwest region led the gain with 0.9 million barrels, while Gulf Coast stocks increased by 0.4 million barrels. East Coast inventories increased by 0.2 million barrels, and Rocky Mountain/West Coast inventories gained 0.1 million barrels.
Propylene non-fuel-use inventories represented 9.5 percent of total propane inventories.
LP unchanged at $1.46/gallon on the farm according to Inputs Monitor data.
The national distillate supply increased 0.5 million barrels to 115.8 million barrels. That is another good improvement toward the five-year average but current levels remain 8.3 million barrels below year-ago.