Ethanol Blog

RBOB Gasoline in Post-Holiday Slide

Rick Kment
By  Rick Kment , DTN Analyst

After all of the aggressive support seen in the gasoline and energy markets through the last couple of weeks, RBOB gasoline futures have sold off sharply as buyer momentum has slowed significantly and traders are concerned that supply growth may continue to pressure prices through the end of May and early June.

Traders are looking for direction from the weekly EIA report which will be released Thursday morning due to the short holiday trading week. But in front of this report, front-month June RBOB gasoline futures have fallen 14 cents per gallon over the last three trading sessions. If inventory levels are seen higher in the report, which focused on inventory as of May 22nd, further pressure is likely to quickly flood into the market. But steady to lower supplies will likely spark some widespread short covering, adding volatility to the already shifty market.

Nearby ethanol futures were unable to remain unaffected by the sharply lower gasoline markets with prices falling 2 to 3 cents per gallon based on the price weakness in energy markets and spill over impact this has on all motor fuels.

Rick Kment can be reached at rick.kment@dtn.com

(ES)

P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
P[] D[728x170] M[320x75] OOP[F] ADUNIT[] T[]
P[L2] D[728x90] M[320x50] OOP[F] ADUNIT[] T[]

Comments

To comment, please Log In or Join our Community .