RBOB gasoline futures collapsed under its own weight. The futures were driven down by some flood water relief and a focus on the growing threat to demand. The steep drop, on top of a report that U.S. retail gas prices fell for the first time in about 8 weeks, was some welcome relief to consumers, but at the same time raises issues about the state of the global economy.
Concerns continue to fester surrounding the Greek bailout and a sharp drop in the Empire State Manufacturing number seem to suggest downside risks to demand. Not to mention the demand destruction that is being caused by the flooding down south as well as the impact on agricultural commodities.
We predicted that gasoline prices had topped, though we were fearful that the Mississippi would make a liar out of us. Yet now it appears we should see continued breaks at the pump!
June crude oil option expiration today! Get ready for potential volatility.