Brent crude (NYMEX:SCN14) is taking the bulk of the risk premium as the battle for control of Iraq Baiji refinery is continuing. The refinery that supplies Bagdad with at least 30% of its product supply has been shut and may be controlled by ISIS. There are reports that there are gasoline lines in Bagdad.
U.S. oil (NYMEX:CLN14) supply seemed to anchor the WTI contract when the EIA reported a less than expected drawdown 600,000 barrel drop in supply. U.S. supply stands at 386.3 million barrels near record. Total motor gasoline (NYMEX:RBN14) inventories increased by 0.8 million barrels last week, and are in the upper half of the average range.
Finished gasoline inventories increased while blending components inventories decreased last week. Distillate fuel inventories increased by 0.4 million barrels last week but are below the lower limit of the average range for this time of year.
Corn and Ethanol Report
In the overnight electronic session the July corn (CBOT:CN14) is currently trading at 444-½ which is 3 cents higher. The trading range has been 445 to 441 so far. The market is showing strength even though the weather is looking more and more that we have ideal growing conditions.
On the Ethanol (CBOT:FZN14) front there were no trades posted in the overnight activity with the July contracts settlement price of 2.057 and is showing 5 bids @2.010 and 2 offers @2.032 so far. This lack of activity is showing the cost Of crude oil prices and Corn prices is not necessarily a cost or emission deterrent.
On the Natural Gas front the July contract is currently trading at 4.685 which are 0.026 cents higher. The trading range has been 4.687 to 4.628 so far. The EIA Gas Storage number has been guessed to show builds of 110 Billion Cubic Feet and anything less will make this market roll regardless of milder temperatures moving in after the heat-dome of muggy weather.
On the crude oil front what is left to say as we play one headline against the other headline. In the overnight electronic session the July crude oil is currently trading at 10619 which are 22 points higher. The trading range has been 10663 to 10600. As we are heading closer to the weekend not too many people would to be short with the geo-political consequences on the horizon.
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