US Banks Face Potential Credit Rating Downgrades
August 16, 2023
The energy markets were down again in yesterday’s trading as it looked like profit taking continued to try and ease the recent rally.
The API inventory update called crude stocks down 6.2 million barrels, gasoline down 760,000 barrels and distillates up 660,000.
The average estimates for today’s DOE inventory report from the Bloomberg survey are looking for crude oil inventories to be down 2.550 million barrels, gasoline down 1.06 million barrels, and distillated down 750,000 barrels. With draws expected in today’s inventory update energy prices are likely to try and move higher to correct some of the market’s recent pullback.
The market could come under more selling pressure as traders heed a warning from Fitch Ratings that US banks, including JPMorgan Chase could be downgraded if the agency further cuts its assessment of the operating environment of the industry.
According to the American Automobile Association, strong demand and a series of refinery outages have pushed the national average retail price of gasoline to $3.86 per gallon on Tuesday, up 7% on the month. In California and Washington, prices have surged to above $5 per gallon. Analysts at Goldman Sachs predict national retail gasoline prices will average $3.90 per gallon this month. Retail prices in the US Midwest increased as much as 21 cents per gallon in Ohio and 16 cents in Michigan in the last week on earlier-than-expected maintenance at a BP refinery in Whiting, Indiana.
The average estimate for today’s propane inventory update is for inventories to increase by 2.39 million barrels.
From Bloomberg – The US is 100% reliant on imports for at least 12 minerals deemed critical by the government, with China being the primary source for many of them, according to Mining.com.