Why are gasoline futures moving lower despite the bid in WTI

2023년 8월 3일

Yesterday, the EIA reported broad inventory levels from last week for Crude Oil, distillates and gasoline. Inputs to refineries averaged 16.5 M bbl/day during the week ending July 28, 2023, which was 40K bbl/day more than the previous week’s average while refineries operated at a reasonably high level capacity of approximately 92.7% last week. Gasoline production increased last week, averaging 9.8 M bbl/day. Distillate fuel production increased last week, averaging 4.9 M bbl/day.

So how does the stronger inventory fundamentals translate to the price of the underlying commodity WTI Crude and product, gasoline? Of the hourly charts shown here, September expiration gasoline looks a tad bit bearish despite the lower level study MACD showing the crossover in the average looking positive overall for prices. While WTI prices are likely headed over 90 into the fall period given the current trend, for the short term, gasoline may be seen as being on the offer block despite the resilience in WTI Crude. Gasoline futures move rather viciously in the RTH sessions and can be a drag on trading accounts if entries are not picked with some precision.

Despite the bid today, I see initial resistance for September futures sitting at 2.8445 with a potential continuation move lower into 2.6630 for a profit target. While this is best taken short at or above 2.8194, it may take a while for us to get to that price. Use a stop a few points above the resistance level shown and aim for the profit target at 2.66309.