Rising Virus Cases Add Fear to Market
June 11th, 2020
The DOE reports crude stocks are up 5.72 million barrels to a total of 538.065 million barrels. Last year for this week stocks were at 485.470 million barrels a difference of 52.595 million barrels. This is a record level for crude oil stocks. Gasoline stocks are up 866,000 barrels for a total stock of 258.661 million barrels. At this time in 2019, there were 234.913 million barrels – a difference of 23.748 million barrels. Distillate stock are up 1.568 million barrels and total stocks are at 175.829 million barrels. Last year for this reporting week total stocks were at 128.372 million barrels, a difference of 47.457 million barrels. Bottomline, the United States still has a lot of inventory.
Propane stocks are down 1.047 million barrels putting total stocks at 66.282 million barrels. Last year at this time there were 66.265 million barrels, which puts the market right at last year’s levels. Midwest propane stocks are up 319,000 barrels putting total Midwest stocks at 15.948 million barrels. Last year at this time there were 17.994 million barrels. The Gulf Coast stocks are down 1.340 million barrels putting total stocks at 41.728 million barrels. In 2019 at this time, there were 42.276 million barrels. The inventory of propane seems to be ok for now and close to normal for this time of year. We all could use a bit of normal.
The energy market is under selling pressure this morning. Equities are opening lower because of news about new cases of coronavirus in some states that have reopened. This is putting a bit of fear back into the market. Some traders are taking profits after the strong rebound from the April lows. New cases are growing fastest in Florida, Texas, Arizona and California.
The market rallied late yesterday afternoon as the Fed said it would keep interest rates low until 2022. The outlook on the unemployment rate and the outlook for GDP growth is still not good. Concerns over unemployment and GDP created selling pressure overnight that has gained steam with news of coronavirus outbreaks spreading.
The U.S. Energy Department said it bought 126,000 barrels of crude oil for the emergency oil reserve. The government is seeking to help oil producers following a decline in fuel demand resulting from the coronavirus pandemic.