Bank Concerns Send Jitters Through Markets
May 4, 2023
JP Morgan Chase bought First Republic Bank a few days ago and CEO Jamie Diamond assured us the bank situation was now stabilized. Yesterday after the close of the energy markets at 4 PM central time, PacWest Bancorp said they we exploring all options including a sale. The market opened at 5 PM Central Time and WTI crude oil, RBOB, and ULSD all had a mini flash crazy and traded down to new lows. I think this shows you how uneasy the market is about the current banking situation and many traders are concerned that the market is not out of the woods just yet. Energy prices did bounce back up rather quickly after the quick sell off and are currently flat, but we will see how activity picks up as the day move on.
The DOE inventory report called crude oil stocks down 1.28 million barrels putting total stocks at 459.633 and last year they were 415.727 a 43.906 million barrels surplus.
Gasoline stocks were up 1.74 million barrels, putting total stocks at 222.878 million and last year they were 228.575 a 5.697 million barrel deficit.
Distillate stocks were down 1.19 million putting total stocks at 110.323 million barrels and last year there were 104.942 a 5.381 million barrels surplus over last year.
Propane inventories were down 597,000 barrels putting total stocks at 58.292 million. Last year at this time total stock were at 40.810, a 17.482 million barrel surplus over last year. Midwest stocks were up 337,000 barrels putting the total Midwest stocks at 12.971 million and last year they were 9.221 million a 3.750 million barrel surplus over last year. Gulf Coast stocks were down 690,000 barrels putting total Gulf Coast stocks at 37.919 million and last year there were 25.395 million a 12.524 million barrel surplus compared to last year.
Yesterday was another day of selling and there were good volumes behind the moves lower. Many see this selling as the market being more fearful of the banking situation than the Fed, the media, or others are letting on. The economy is not as sound as many have thought. All those big bank predictions of $100 dollar oil seem very far off now.