Memorial Day Travel Expected to Rebound
May 26, 2021
The API had crude stocks down 439,000 barrels. Gasoline stocks down 2 million barrels and distillate stocks were down 5.1 million barrels. The average estimates for today DOE inventory report from the Bloomberg survey are calling for crude supplies to be down 751,000 barrels and gasoline supplies down 1.361 million barrels, and distillates down 2.036 million barrels.
Propane stocks are estimated to be up 2.8 million barrels. The propane market needs some strong builds in the coming months to help ease prices and if builds are less than average prices will stay supported. This thought has kept prices up even when crude prices moved lower.
The market continues to be stuck in its ranges with the potential for high volatility and big intraday moves as the market move higher and or lower on the latest news.
AAA expects 37 million American to travel, mostly by car and plane for the Memorial Day holiday weekend. That is a 60% increase over last year’s holiday and is a strong indication that summer travel is going to be largely popular, said Jeanette McGee, AAA spokesperson. AAA says that travelers this weekend will see the most expensive gas prices since 2014. Despite the strong rebound of 60% it is still 13.3% less than in 2019.
The March Case-Shiller index for house values had home prices up 13.2% on the year. This is the highest level since December 2005 during the housing bubble. Phoenix up 20%, San Diego up 19.1%, Seattle up 18.3%.
The US and Iran negotiations will be a factor over these markets until there is some conclusion. Traders do not want to buy this market when the potential is out there that more barrels could be coming out of Iran soon. They also do not want to sell this market when the possibility is there that nothing happens, and they are no additional barrels. The net result is the market is stuck.
World powers started their fifth round of negotiations to revive the nuclear agreement with Iran that will reinstate limits on Iran’s nuclear program in exchange for the country’s return to the oil markets and the global economy.