Fed Chair Powell Expects Another Interest Rate Hike This Year
September 21, 2023
The DOE inventory report had crude oil inventories down 2.14 million barrels, gasoline down 830,000 barrels and distillates down 2.87 million barrels. Cushing, Ok crude oil stocks fell by 2.06 million barrels to 22.9 million barrels, the lowest level since July 2022.
Total US crude inventories are at 418.456 million and last year there were 430.774 million a 12.318 million barrels deficit.
Total gasoline inventories are 219.476 and last year there were 214.610 a 4.866 million barrel surplus. The three-year average is 222.583 a 3.107 million barrel deficit to current.
Total distillates inventories are 119.666 million barrels and last year there were 117.250 million a 2.416 million barrel surplus and the three-year average is 141.966 a 22.30 million barrel deficit to current.
Propane inventories were up 1.589 million barrels, less than expected but total inventories are now at 100.702 million, the second highest level for this time of year. The market is now 19.5 million barrels above where it was last year, some 24% more propane than just one year ago. The fundamentals of propane are bearish as stocks are very ample. All markets are near or above the highs of their three-year average ranges: East Coast, Gulf Coast, Midwest, and West Coast. Production and demand were both up on the week, but exports were down big.
The Fed left interest rates unchanged but Fed Chair Jerome Powell indicated that rates would need to be higher for longer. He also indicated that the Fed would need to raise rates one more time this year. This news rallied the dollar and put some pressure on energy prices yesterday, but the low inventories continue to prompt buying.