ULSD Up 53% in Q3 Rally; Gasoline Stocks at Historic Lows


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Distillate futures surged more than 53% over the third 
quarter as September delivered another strong month for U.S. energy markets, 
propped up by persistent refined product deficits, historic gasoline inventory 
draws and unyielding geopolitical risk premiums across the Middle East. 

   Crude and refined fuel benchmarks secured a third consecutive monthly 
increase as tight global supply and the protracted U.S.-Iran war outweighed 
partial export recoveries from Saudi Red Sea ports. 

   Downstream contracts surged in their final session for September amid 
precariously low product supplies.  Distillate stocks remained severely 
constrained globally, with EIA reporting domestic inventories trailing the 
five-year average by more than 13%. High international demand and impaired 
processing capacity from the Persian Gulf to Russia have kept fuel markets 
under steady upward pressure despite ongoing diplomatic talks.

   Energy Information Administration (EIA) data released Wednesday (9/30) 
showed U.S. motor gasoline inventories down for a second straight week, falling 
by 1.7 million bbl to 204.4 million bbl to reach the lowest national level 
since November 2014. In the Midwest, gasoline stocks plunged 1.8 million bbl to 
41.8 million bbl, marking an all-time regional low since EIA data collection 
began in December 1989. 

   At Wednesday's close, NYMEX November WTI crude rose $1.04, or 1.16%, to 
settle at $90.42 bbl, after reaching a session high of $91.96. For all of 
September, WTI advanced about 6%, while for the third quarter it climbed almost 
31%. 

   ICE November Brent moved up $0.91, or 0.89%, to $103.50 bbl, after an 
intraday high at $104.05. Brent rose about 17% on the month and 42% over the 
three-month period.

   NYMEX ULSD for October delivery climbed $0.0590, or 1.20%, to close at 
$4.9569 gallon, after peaking at $5.4275 during the session. October ULSD rose 
12% for September and 53% over the quarter. 

   RBOB for October advanced $0.1596, or 4.87%, to finish at $3.4378 gallon, 
with an intraday high at $3.3887. It gained 10% for the month and 17% for the 
quarter. 

   By 2:25 p.m. ET, the U.S. dollar index gained 0.064 points on the day to 
101.180 against a basket of currencies. 




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