I updated the first half of Gas and oil fall for Ruby's July driving update with Farewell Ruby, hello Prius! Now it's time to update the other half.
When I checked Gas Buddy two weeks ago, the stations in my old neighborhood were selling regular for $2.76. Tonight, it shows them at $2.65. Furthermore, the Detroit average has fallen to $2.72, 21 cents below the $2.93 it was at two weeks ago. It appears likely to fall even more, as Reuters reported last Friday in Oil falls to lowest close since March, down a fourth week.
Brent and U.S. crude futures settled on Friday at their lowest since March and posted their fourth straight weekly decline as weak economic data from China and a rise in U.S. oil drilling rigs applied pressure.Follow over the jump for more from Reuters.
Brent September crude fell 65 cents to settle at $54.62 a barrel, the lowest close since March 19 and off 4.3 percent for the week. The $54.30 session low was the lowest front-month price since April 2.
U.S. September crude fell 31 cents to end at $48.14, its lowest settlement since March 31 and down 5.5 percent for the week. The session low of $47.72 was the lowest intraday price since April 1.
Brent and U.S. crude have so far clocked double-digit losses in July. With U.S. crude off 19 percent, it could challenge December's 19.4 percent drop, which was the biggest monthly slump since the financial crisis in 2008.
Demand for gasoline has been strong, keeping refineries churning at high utilization rates, but August U.S. RBOB gasoline futures settled below its 200-day moving average of $1.8514 a gallon on Friday.
"This looks like profit-taking as the end of the U.S. driving season gets closer," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.
That was last Friday. Prices have fallen in overnight trading as markets opened in Asia, as Reuters just reported in Oil prices fall on oversupply worries; investors look to Fed meeting.
Oil prices fell on Monday after closing the previous session at their lowest levels since March on renewed oversupply concerns from the United States and Iraq, although a weaker dollar helped to limit deeper losses.If that's true, then the likelihood of an oil-shock recession will likely stay low until at least 2017.
Brent crude for September fell 6 cents to $54.56 a barrel as of 0340 GMT after dropping 65 cents in the previous session to $54.62, its lowest close since March 19.
U.S. crude for September was down 12 cents at $48.02, after briefly dropping below $48 a barrel. U.S. oil fell 31 cents in the previous session to $48.14, its lowest settlement since March 31.
Sparking new worries about a global glut, U.S. oil producers added 21 drilling rigs last week, the biggest rise since April 2014, according to Baker Hughes.
The expectation of continued abundant oil supplies, including an output increase from Saudi Arabia and other members of the Organization of the Petroleum Exporting Countries, led the National Australia Bank on Monday to revise its oil price forecasts in a monthly report.
"We now expect oil prices to stay below $70 a barrel for the rest of 2015 and 2016," the bank said.
One of the outcomes of lower prices was a decrease in U.S. oil production. So far, that hasn't happened, as U.S. oil drillers add rigs despite crude price collapse: Baker Hughes.
Oil producers, who cut rigs in the face of falling prices late last year, began to add rigs back in the week ending July 2, oil services company Baker Hughes Inc said in its closely followed report.Even with the high domestic production, the U.S. is importing even more oil.
The rise in the rig count this week was the biggest increase since April 2014. It was, however, only the third addition over the past 33 weeks, bringing the total rig count up to 659, the highest since late May.
Drillers added oil rigs in all four of the major U.S. shale oil basins with three in the Permian in West Texas and eastern New Mexico, two in the Eagle Ford in South Texas, and one each in the Niobrara in Colorado and Wyoming and the Bakken in North Dakota and Montana.
The current bear market was the biggest decline for U.S. crude futures since the front-month fell nearly 60 percent from over $107 in June 2014 to under $44 in January due to those same oversupply and uninspiring demand growth worries.
In response to that near 60 percent price collapse, U.S. drillers eliminated thousands of jobs and idled 60 percent of the record high 1,609 oil rigs that were active in October.
Despite those cuts, U.S. crude production has averaged 9.6 million barrels per day for nine weeks in a row, its highest level since the early 1970s, according to government data.
Crude imports have risen from a recent low of 6.9 million barrels per day (bpd) in the four weeks ending on May 22 to 7.5 million bpd in four weeks ending July 17...By the way, the U.S. isn't the only country increasing production in the face of low prices. Iraq's southern oil exports head for another record in July.
In the week ending July 17, imports hit 7.94 million bpd, the second highest rate for the year, according to data published by the U.S. Energy Information Administration.
Crude imports have been rising strongly even though crude stockpiles are close to their highest levels for 80 years.
The fast pace of imports has been enough to keep stocks from falling even though U.S. refineries are processing crude at record rates of more than 16.8 million bpd.
Iraq's southern oil exports have risen above 3.0 million barrels per day (bpd) so far in July, according to loading data and an industry source, setting shipments from OPEC's second-largest producer on course for a monthly record.What about the effect of the Sith Jihad on Iraq's northern oil fields?
The Iraqi boost is an indication of continued high output from the Organization of the Petroleum Exporting Countries, which is focusing on keeping market share rather than curbing supply to support prices.
Exports from Iraq's southern terminals averaged 3.06 million bpd in the first 23 days of this month, up from a record 3.02 million bpd in all of June.
The southern fields produce most of Iraq's oil. Located far from the parts of the country controlled by Islamic State militants, they have kept pumping despite the conflict.Looks like they're not having that much of an effect. Good.
Shipments from Iraq's north via Ceyhan in Turkey have remained steady despite tensions between Baghdad and the Kurdistan Regional Government over budget payments.
Independent KRG exports averaged 520,000 bpd in the first 23 days of July, according to loading data, while SOMO has exported one tanker and one pipeline shipment during the month, or an average of 33,000 bpd.
Taken together, this means total northern shipments are close to June's rate, even though exports under the SOMO banner have slowed to a trickle.
In the meantime, watch for continuing falling prices at the pump and the return of Limbo Kitty. Happy motoring!