MARKETWIRE ALERTS

MARKETWIRE ALERTS 

MarketWire Afternoon News April 24th:

Updated at 5:00 PM ET 

HEADLINES:

— Chicago CBOB Basis Hits 5-Month High on Cycle Shift

— CFTC: WTI Net Longs Tumble as Futures Hit 5-Week Low

— Dallas Fed: U.S. Output Seen Rising on Iran War

— Baker Hughes: Weekly North America Rig Count Up by 1

— Analysis: Oil Futures Fail to Reflect Hormuz Supply Impact

— Analysis: More Pain in CA if Gas Stays Costly Until 2027

— U.S. Weekly Rack ULSD Rises 13.8cts; Gasoline Up 21.9cts

— ExxonMobil Reports Flaring at Beaumont, TX, Refinery

— U.S. Extends by 90 Days Waiver on Jones Act for Shipping

NEWS:

Chicago CBOB Basis Hits 5-Month High on Cycle Shift

Chicago CBOB basis strengthened Tuesday (4/22), narrowing to its tightest level in more than five months as the market transitions out of third-cycle barrels and into first-cycle positioning.

CBOB for West Shore delivery was assessed at an 8.5cts discount to May NYMEX RBOB futures, up 9cts from the prior session when it was at a discount of 17.5cts.  The current differential is the strongest since a 7.5cts discount assessed on November 14, 2025, according to DTN Energy data. Market chatter during the current session indicated values at around a discount of 5cts to 6cts.

Chicago pipeline CBOB is shifting out of Cycle 3 (C3) barrels, with the move toward first cycle (C1) positioning supporting prompt values as market participants adjust for tighter near-term availability.

“Part of the move is tied to the cycle shift, but it also feels like someone needs barrels now,” a source familiar with Midwest refined product trading said.

The Buckeye Complex and Wolverine pipeline reflected similar strength, with CBOB basis assessed at an 8.50cts discount, narrowing by 6.25cts from the prior session, according to DTN data.

Markets will be watching whether this strength carries into next week as trading fully transitions into first-cycle barrels.

CFTC: WTI Net Longs Tumble as Futures Hit 5-Week Low

Money managers’ bullish bets on NYMEX West Texas Intermediate (WTI) crude fell during the week ended April 21 as prices hit a five-week low, Commodity Futures Trading Commission (CFTC) data showed.

Front-month WTI futures tumbled to $80.56 bbl on April 17 after Iran briefly opened the Strait of Hormuz amid a ceasefire in the Middle East conflict, prompting a sharp reduction in net long positions.

In WTI, noncommercial long positions fell by 10,448 contracts to 380,020, while noncommercial short positions rose by 3,791 contracts to 187,718, according to the weekly Commitment of Traders report. This caused the net noncommercial long position in WTI to shrink by 14,239 to 192,302, while open interest decreased by 109,745 contracts to 1,984,747.

In NYMEX RBOB gasoline futures, noncommercial long positions gained by 3,824 contracts to 79,546, while short positions shrunk by 474 contracts to 22,431. This boosted the noncommercial net long position by 3,350 contracts to 57,115, although open interest in gasoline fell by 7,336 contracts to 330,039.

In NYMEX ULSD futures, noncommercial long positions climbed by 1,345 contracts to 37,085, while short positions surged by 3,497 contracts to 31,631. These changes caused the noncommercial net long position in ULSD to ease by 2,152 contracts to 5,454, while open interest gained by 3,810 contracts to 247,175.

In NYMEX natural gas futures, noncommercial long positions rose by 5,688 contracts to 242,027, while short positions fell by 12,885 contracts to 410,342. That caused the net short position in natural gas to retreat by 18,573 contracts to 168,315, as open interest dropped by 8,577 contracts to 1,576,663.

Dallas Fed: U.S. Output Seen Rising on Iran War

U.S. oil executives expect domestic crude production to increase through 2026 and 2027 as the ongoing conflict involving Iran disrupts global supply flows and supports higher prices, according to a survey released Thursday (4/23) by the Federal Reserve Bank of Dallas.

The survey, conducted between April 15–20, showed most executives anticipate modest production gains, with 43% expecting U.S. output to rise by up to 250,000 bpd in 2026. For 2027, the largest share of respondents, 32%, see production increasing between 250,000 bpd and 500,000 bpd.

Executives also expect disruptions tied to the Strait of Hormuz to persist in the near term. Only 20% of respondents said traffic would return to normal by May, while 39% expect normalization by August and 26% by November.

Looking further out, geopolitical risk remains elevated, with 48% of respondents saying future disruptions to the Strait are “very likely” within the next five years and another 38% viewing them as “somewhat likely.”

Executives also expect higher structural costs tied to the disruption, with the most common response indicating shipping costs from the Persian Gulf could increase by more than $2 bbl but not more than $4 bbl once the conflict ends.

Baker Hughes: Weekly North America Rig Count Up by 1

North American energy drilling activity rose by one rig this week, according to Baker Hughes’ weekly report released Friday (4/24).

The report shows the regional rig count at 674 in the current week, compared to 673 recorded the previous week. Rigs for Canada and the U.S. combined were lower by 41 than the 715 actively deployed in the same week of last year.

This week’s change was driven by a modest gain in the U.S., where the count rose by one to 544. In Canada, the count remained unchanged from the previous week at 130, up from 128 a year ago.

A year ago, U.S. rigs totaled 587. This week in the U.S., rigs in inland waters remained unchanged at two; rigs on land rose by two to 531 while offshore rigs dropped by one to 11.

By trajectory, directional rigs in the U.S. fell by one to 45, while horizontal rigs rose by two to 484 and vertical rigs remained unchanged at 12.

Analysis: Oil Futures Fail to Reflect Hormuz Supply Impact

Oil futures hit four-year highs on the U.S.-Israel war on Iran and remain about 50% above ante bellum levels but traders still appear to be pricing in unfounded optimism for a quick supply restoration not reflective of the current disruption’s severity.

Front-month Brent futures rallied in March to $119.50 bbl, about 65% above pre-war prices, compared to the 22% jump in the early weeks of the outbreak of the Russo-Ukrainian war, when they peaked at $123.21 bbl. The Brent high for April though was $111.89 and it moderated further to $104.47 this week as hopes of an imminent resolution to the current conflict led bouts of volatility in recent weeks.

Spot market pricing in oil, however, reveals a better connection to the depth of the disruption caused to petroleum cargoes on the Strait of Hormuz, which used to serve 20 million bpd or 20% of world supply.

WTI ex Houston, for instance, quadrupled its basis over futures in the first three weeks of the war alone before rocketing to more than $25 bbl and settling in the $8-$12 bbl range, compared to around $2 bbl before the war. The jump in reaction to Russia’s 2022 invasion of Ukraine, in contrast, was much more muted, briefly rising by 250% before slumping back a few weeks later.

In Europe, the basis price of a barrel of North Sea crude has since the start of the Iran conflict shot up from less $1 bbl to anywhere from $20 to $30 bbl, depending on the assessment, before finding footing in the $9-$13 bbl range. This surge in physical crude prices was nearly four times as pronounced as the one sparked by the war in Europe, marking an unprecedented disconnect between paper barrels and real ones.

During the first months of the war in Ukraine, global crude oil supply looked set to be stifled by international sanctions on Russia and a U.S.-EU embargo on Russian oil imports. The impact on actual physical supply, however, was rather limited after the initial shock, with flows being diverted from Europe to buyers in the Middle East, India and China. There was a small dip in Russian crude output, but it came at a time when Russia was already pledged to curbing production as part of OPEC+.

The Hormuz crisis, in contrast to the Russia Ukraine war, has affected more than just short-term availability. Some 15 million bpd of crude oil and 5 million bpd in refined product flows have been cut off the market since Iran instituted its blockade of the waterway in the first week of March. The lack of outlets amid limited options to divert flows elsewhere forced producers in the region to throttle output by more than half. Precautionary measures, damages to energy infrastructure and rapidly filling storage tanks caused around 12 to 15 million bpd of pre-war supply to be offline this month.

The disruption on the Hormuz, which the International Energy Agency has dubbed the largest in history and more impactful than the crises of the 1970s combined, will likely be slow to ease once exports from the Persian Gulf can resume. The number of available empty dirty tankers in the region is at half of typical levels, capping how quickly exports can return. In addition, export terminals and moorings have sustained damage from Iranian drone and missile attacks and will need repairing.

Logistical constraints aside, regional oil production will take months to approach pre-war levels. The reopening of shipping lanes is a necessary, but insufficient condition for restoring oil supply in this current situation. The longer an oil well is idle, the higher the risk of requiring maintenance to fully restore output. More than half of production has been at a standstill this month, with some wells being shut since the beginning of the war. Prolonged shutdowns and war damages could also lead to some supply being permanently lost.

Analysis: More Pain in CA if Gas Stays Costly Until 2027

Californians are likely to face more pain at the pump than U.S. drivers elsewhere if gasoline stays costly until next year, as refining peculiarities and tightening supply add to the state’s disproportionate fuel pricing.

The outlook comes as U.S. Energy Secretary Chris Wright acknowledged this week that relief at the pump may not arrive soon, saying drivers as a whole “may not see gasoline below $3 per gallon again until 2027.” 

The below-$3 gallon average for U.S. gasoline was true prior to the end-February outbreak of the Iran war. Since then, pump prices have risen more than $1 gallon, peaking at a 2026 high of $4.123 last week before moderating to $4.044 this week.

California prices were, however, well above $3 gallon even before the war, averaging $4.34 at end-February. This week, gasoline in the state stood at $5.32 gallon and at $4.93 in the broader West Coast. In some parts of Los Angeles, gasoline was also already reported at $8 gallon earlier this month.

University of Southern California business professor Michael A. Mische says in a study that California prices could climb even further in the coming months as the state’s refining capacity declines and supply disruptions come to a head, pushing average prices to between $7 and $8 gallon.

The warning reflects a fundamental shift in the West Coast fuel market. According to the U.S. Energy Information Administration, California is set to lose about 17% of its refinery capacity over a short period due to planned shutdowns, a reduction that is expected to increase price volatility and tighten supply across the region. 

Two major facilities are central to that transition. The closure of Phillips 66’s 139,000 bpd Los Angeles refinery has already removed a key source of gasoline production, while Valero Energy plans to idle its 145,000 bpd Benicia refinery later this year.

Together, the facilities represent a significant share of California’s fuel supply and are expected to increase reliance on imports from overseas refineries capable of producing California-grade gasoline.

Market participants say the immediate impact may be heightened volatility. One U.S. West Coast gasoline trader said the region is likely to experience higher prices and more frequent price swings this year, pointing to refinery disruptions and flaring events tied to operational adjustments and maintenance.

With fewer refineries operating in California, even routine outages can translate into tighter supply conditions and faster price increases at the wholesale level.

Recent inventory declines have reinforced those concerns. Californian gasoline stocks recently fell to multi year lows amid supply disruptions and slower imports, underscoring how quickly the market can tighten when supply chains are strained.

The Iran war and the resulting blockade of the Strait of Hormuz – a major waterway for energy shipments – complicates matters further for West Coast refiners who rely inordinately on Middle East oil imports.

For policymakers and consumers, the message is increasingly clear: Shrinking refining capacity, import dependence and global supply risks could combine to keep gasoline prices elevated and more volatile in California than elsewhere in the U.S.

U.S. Weekly Rack ULSD Rises 13.8cts; Gasoline Up 21.9cts

Wholesale rack prices for ultra-low sulfur diesel (ULSD) and gasoline moved higher Friday (4/24), extending gains from the prior session. On a week-over-week basis, both products posted solid increases as physical markets firmed alongside stronger futures earlier in the week despite renewed volatility tied to the U.S.-Iran conflict.

Nationwide ULSD rack prices averaged $4.0997 gallon, up 4.43cts from Thursday’s $4.0554 gallon, while conventional unleaded gasoline averaged $3.5329 gallon, up 7.60cts on the session, according to DTN data.

On a week-over-week basis, ULSD rack prices increased 13.83cts from $3.9614 gallon on Friday (4/17), while gasoline rose 21.92cts from $3.3137 gallon over the same period, reflecting a stronger recovery in gasoline relative to distillates.

Oil and product futures were steady Friday morning on reports of imminent peace talks after a four-day uptrend that left energy markets on track to large weekly rises amid dimming prospects for a quick end to the Middle East conflict that has caused the largest supply disruption in history.

By 08:35 am ET, NYMEX WTI crude for June delivery was down $0.46 to $95.39 bbl and ICE Brent for June rose $0.01 to $105.08 bbl.  For the week, WTI showed a 13% rise while Brent was up almost 17%.

Downstream, NYMEX ULSD futures for May delivery slipped by $0.0088 to $3.9794 gallon, and front-month NYMEX RBOB futures dipped by $0.0399 to $3.4222 gallon.

Rack prices continued to move higher across most regions Friday, reflecting a steady adjustment in physical markets after last week’s reset.

ULSD racks increased across all regions. West Coast values rose 6.42cts to $4.9586 gallon, maintaining the strongest regional premium. Midwest prices climbed 5.30cts to $3.8785 gallon, while Gulf Coast values increased 3.86cts to $4.0658 gallon. East Coast ULSD rose 3.33cts to $4.1177 gallon, and Rocky Mountain prices edged higher to $4.2537 gallon.

Relative to the national ULSD rack average of $4.0997 gallon, PADD 5 held the widest premium at 85.89cts above the U.S. benchmark, followed by PADD 4 at 15.40cts above. PADD 1 traded slightly above the national average, while PADD 2 and PADD 3 remained at discounts of 22.12cts and 3.39cts, respectively .

On conventional unleaded gasoline racks, all regions moved higher Friday. East Coast gasoline rose to $3.2408 gallon, while Midwest prices increased to $3.0319 gallon. Gulf Coast values climbed to $3.1395 gallon, and Rocky Mountain prices rose to $3.3533 gallon. West Coast gasoline increased to $4.2615 gallon, maintaining the only premium position at 72.86cts above the national average .

Compared with the national gasoline average of $3.5329 gallon, PADD 2 remained the weakest region at a 50.10cts discount, followed by PADD 3 and PADD 1, while PADD 5 continued to reflect the strongest pricing structure.

Premium gasoline rack prices also moved higher across all regions, broadly in line with conventional gasoline, with West Coast values remaining elevated at $4.6510 gallon.

The latest move suggests physical markets are pushing higher, though at a more measured pace compared to futures. Paper markets have been quick to respond to geopolitical headlines, while rack prices are catching up more gradually as buying activity and supply conditions adjust following last week’s correction.

Even with the recent swings, structure remains supportive. RBOB backwardation is holding above 13cts, while ULSD remains steeply backwardated with the front month trading more than $2 above deferred contracts, pointing to continued strength in prompt demand despite ongoing volatility in flat price direction.

ExxonMobil Reports Flaring at Beaumont, TX, Refinery

ExxonMobil’s 630,000 bpd Beaumont, Texas, refinery reported an air emission event at its facility’s Fluid Catalytic Cracking (FCC) unit, with emissions released through three separate flares, according to a filing with the Texas Commission on Environmental Quality,

The incident began at 3:09 p.m. on Tuesday (4/22) and ended at 10:28 p.m. the same day.

According to the initial report filed with state regulators, sulfur dioxide was the largest contaminant released, with an estimated 5,787 pounds emitted primarily through the FCC Unit Flare. Other contaminants included carbon monoxide, nitrogen oxides, hydrogen sulfide, propylene, butane, butenes, and various volatile organic compounds across all three flare points.

Plant operators responded by routing process streams to the flares to minimize overall emissions. The company reported no offsite impacts and stated that all contractual commitments were expected to be met.

U.S. Extends by 90 Days Waiver on Jones Act for Shipping

The White House announced Friday (4/24) the Jones Act that allows allow international tankers to transport energy and agricultural products between U.S. ports will remain in place for another three months, extending its original two-month deadline.

U.S. President Donald Trump first announced the 60-day waiver in mid-March to help stabilize energy prices and make it easier for more ships to travel to the U.S. following the effective closure of the Strait of Hormuz after the breakout of the Iran war at end-February.

New data compiled since the initial waiver showed that significantly more energy supplies were able to reach U.S. ports at a faster pace, said a White House social media post that announced the 90-day waiver of the regulation though mid-August.