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Outlook: Higher trade this morning as markets turn their attention back to concerns regarding Hurricane Ida. A majority of the U.S. offshore oil production remains shut in while refineries are seen recovering at a faster pace. According to the Department of Energy, only about 1 million bpd of refining capacity remains shut down, but analysts expect that the restarted refineries will be unable to operate at full capacity for the time being. Additional supply concerns stem from reports of protests at Libyan ports, causing a blockage of oil exports. Analysts will now look closely at inventory data scheduled for this afternoon and tomorrow morning, as it is expected to convey the effects of Ida on U.S. stockpiles.

Crude

• Protesters have blocked oil exports at two Libyan ports, Es Sider and Ras Lanuf, where three tankers were waiting to load.
• As 79% of U.S. offshore oil production remains shut in, Ida is ranking among the worst storms cost wise to hit the U.S. since 2005.
• BP has begun restarting its operations in the Gulf of Mexico and has also started repairs at its onshore assets in Houma and Port Fourchon.
• The October crude oil contract is trading $1.31 higher at $69.66. The 20-day and 100-day moving averages are $67.57 and $67.58 respectively. The 14-day RSI is 53.50%.
• As of 8:30 am CST: October Brent is up $1.05 at $72.74 and the U.S. dollar index is 0.194 higher at 92.706 while the nearby e-mini S&P 500 futures contract is down 7.25 points at 4512.

Diesel

• Fuel oil’s growing discount to LNG in Asia has prompted surging demand and in turn increasing prices as Asian buyers seek alternatives for power generators.
• The October ULSD contract is trading $0.0288 higher at $2.1504. The 20-day and 100-day moving averages are $2.0832 and $2.0746, respectively. The 14-day RSI is 54.94%.
  

Gasoline

• According to a Descartes Labs survey based on cellular movements, U.S gasoline demand fell by 0.4% in the week ending September 3, the sixth consecutive weekly decline.
• Toll road data last week for three European and three Latin American countries all exceeded the equivalent week in 2019 as more motorists get on the road despite the Delta variant.
• The October RBOB contract is trading $0.0346 higher at $2.1646. The 20-day and 100-day moving averages are $2.0886 and $2.0407, respectively. The 14-day RSI is 55.64%.
  

Propane

• Yesterday’s updated crop progress report pegged U.S. corn at 21% mature compared to the 5-year average of 19%. The G/E rating fell by one point to 59%.
• At last look, Conway propane was trading down $0.00500 at $1.18750 Mt. Belvieu was trading down $0.00500 at $1.19000.