MARKETWIRE ALERTS

MARKETWIRE ALERTS 

MarketWire Afternoon News for January 29th:

Updated at 5:00 PM ET 

HEADLINES:

— Analysis: U.S. Dollar Weakness a Boon to Fuel Exports

— CEC: California Gasoline Stocks Climb 25,000 Bbl on Week

— CEC: California Diesel Stocks Fall 293,000 Bbl on Week

— EIA: US NatGas Storage Reports 242 Bcf Weekly Withdrawal

— U.S. Trade Deficit Jumped 94.6% in November

— U.S. Nonfarm Business Productivity Up 4.9% in Q3 2025

— Valero’s Q4 Refining Segment Drives $1.7B Operating Income

NEWS:

Analysis: U.S. Dollar Weakness a Boon to Fuel Exports

Oil prices rallied this week as a sell-off in the U.S. dollar boosted commodity prices, with some of the largest holders of U.S. treasuries and equities reducing their exposure to U.S. assets. With more dollar weakness forecast hereon, the U.S. crude refining sector looks poised to benefit in more ways than one.

The dollar’s tumble came as European Union (EU) allies – some of the largest holders of U.S. bonds – last week announced investment diversification plans to lessen their entanglement with the U.S. economy, following repeated threats by U.S. President Donald Trump to annex Greenland.

While Trump last week ruled out military options, renewed tariff threats on Canada, France and other trading partners added to uncertainty and to Europe’s resolve to diversify away from the United States.  On Tuesday, the European Union announced a free trade agreement with India, which aims to double EU goods exports by 2032 and reduce tariffs by more than 96%.

Even if the dollar were to get some near-term relief, it will find it hard to escape the pressure of the systemic downsizing of U.S. currency reserves held by global central banks. From 2022 to 2024, central banks swapped their dollars reserves for over 1,000 tons of gold annually, the World Gold Council said. However, purchases declined to 850 tons in 2025 and are expected to decline this year. 

Surging U.S. bond yields and the potential for European reprisal against U.S. tariffs have also been weighing on the dollar.  

The yield on the 10-year U.S. Treasury note hit a five-month high of 4.315 earlier this month and hovered at 4.27 this week. The EU has proposed tariffs on 93 billion euros, or $108 billion, worth of U.S. goods, and could consider the “fire-sale” of $8 trillion in U.S. Treasury holdings that could crash the dollar.

Oil prices and the dollar have a decades-long history of a strong inverse correlation. A softer dollar typically means higher oil prices, while a stronger dollar has the opposite effect.

However, this long-standing relationship started to break down in early 2021. The currency value effect was overshadowed by the rebound in crude prices from pandemic lows as demand recovered, while the dollar strengthened on the back of a restrained U.S. fiscal and monetary response. Over the following four years, the dollar index and crude oil futures traded in tandem, challenging decades of conventional wisdom.

The inverse correlation reappeared, albeit much murkier, in the spring of 2025 as the dollar slipped in reaction to trade-punitive U.S. tariffs.

Over the past week, crude prices rallied amid the U.S. dollar plunging to a four-year low, but the timing of these events does not necessarily indicate a return to normal.

Good news for net exporters

The geopolitical risk premium tied to oil has ballooned in wake of protests in Iran and the fear of possible U.S. military strikes on the country producing 3.2 million bpd, situated in a region responsible for around a third of global oil supply.

Looking forward, U.S. refiners may still benefit from a weaker dollar in multiple ways. Higher crude prices typically mean stronger refining margins, and a softening currency makes U.S. products more attractive to international buyers. This is generally good news for net exporters – last year, total U.S. oil and product exports surpassed imports by 2.27 million bpd last year, according to Energy Information Administration data.

Fuel inventories appear ample into the start of 2026, with domestic refiners maximizing operations and delaying non-essential maintenance to exploit refining margins that are up more than 60% year-on-year. With a softer dollar and clean tanker rates that are down 38% on the year, U.S. fuels may regain a competitive edge on the global market.

CEC: California Gasoline Stocks Climb 25,000 Bbl on Week

California gasoline inventories rose in the week ending January 23, with gains in both Northern and Southern California, according to the California Energy Commission’s Weekly Fuels Report released Thursday (1/29).
Statewide gasoline stocks, including CARB reformulated, non-California, and blending components, climbed by 25,000 bbl to 11.122 million bbl, while remaining down 1% from a year ago.
Northern California gasoline inventories climbed by 224,000 bbl to 5.942 million bbl, and were up 14% year-on-year.
Northern CARB reformulated gasoline stocks rose by 37,000 bbl to 3.76 million bbl. Northern non-California gasoline stocks increased by 100,000 bbl to 377,000 bbl, while Northern blending components edged up by 87,000 bbl to 1.805 million bbl.Southern California gasoline inventories declined by 199,000 bbl to 5.18 million bbl, while remaining 14% higher from last year’s levels.
Southern CARB reformulated gasoline stocks fell by 114,000 bbl to 2.053 million bbl. Southern non-California gasoline stocks also dropped by 114,000 bbl to 399,000 bbl, while Southern blending components climbed by 29,000 bbl to 2.728 million bbl.Statewide gasoline production fell by 176,000 bbl to 5.207 million bbl, and were 10% below last year.
Southern California gasoline production slipped by 30,000 bbl to 3.421 million bbl, while declining 5% annually.Southern CARB reformulated gasoline production rose by 29,000 bbl to 3.181 million bbl, while Southern non-California gasoline production fell by 59,000 bbl to 240,000 bbl.
Northern California gasoline production edged lower by 146,000 bbl to 1.786 million bbl, slipping 18% beneath 2025 levels.Northern CARB reformulated gasoline production fell by 142,000 bbl to 1.658 million bbl, while Northern non-California gasoline production declined by 4,000 bbl to 128,000 bbl.

CEC: California Diesel Stocks Fall 293,000 Bbl on Week

California diesel inventories declined in the week ended January 23, with draws in both Northern and Southern California, according to the California Energy Commission’s Weekly Fuels Report released Thursday (1/29).

Statewide CARB diesel stocks and other diesel fuel stocks fell by 293,000 bbl to 2.811 million bbl, 10% below last year.

Northern California diesel inventories slipped by 177,000 bbl to 1.303 million bbl, 4% above last year.

Northern CARB diesel stocks fell by 123,000 bbl to 906,000 bbl. Northern other diesel fuel stocks dropped by 54,000 bbl to 397,000 bbl.

Southern California diesel inventories declined by 116,000 bbl to 1.508 million bbl, 15% below last year.

Southern CARB diesel stocks rose by 13,000 bbl to 773,000 bbl. Southern other diesel fuel stocks fell by 129,000 bbl to 735,000 bbl.

Statewide diesel production edged lower by 22,000 bbl to 1.475 million bbl, 32% above last year.

Southern California diesel production rose by 52,000 bbl to 1.079 million bbl, 62% above last year.

Southern CARB diesel production climbed by 182,000 bbl to 723,000 bbl, while Southern other diesel fuel production declined by 234,000 bbl to 356,000 bbl.

Northern California diesel production increased by 30,000 bbl to 396,000 bbl, 12% below last year.

Northern CARB diesel production rose by 40,000 bbl to 268,000 bbl, while Northern other diesel fuel production dropped by 10,000 bbl to 128,000 bbl.

EIA: US NatGas Storage Reports 242 Bcf Weekly Withdrawal

U.S. Energy Information Administration data released midmorning Thursday (1/29) show a 242 billion cubic feet withdrawal from U.S. natural gas storage to 2.823 trillion cubic feet in the week ended January 23.
Natural gas in U.S. storage is 7.9% higher than last year and 5.3% above the five-year average of 2.68 Tcf.
Regionally, EIA reports the East registered a 55 Bcf withdrawal to 577 Bcf, 2.9% more than a year ago and 4.3% lower than the five-year average.
Natural gas in storage in the Midwest decreased 76 Bcf week-on-week to 676 Bcf, a 0.4% surplus compared to the same week a year ago and 6.4% lower than the five-year average.
Mountain region natural gas in storage decreased 14 Bcf, up 6.5% year-on-year to 34.1% above the five-year average.
South Central storage fell 89 Bcf to 1.05 Tcf, 14.1% more than in the same week last year and 8.6% above the five-year average.

U.S. Trade Deficit Jumped 94.6% in November

The U.S. trade deficit nearly doubled in November amid a ballooning goods deficit, Commerce Department and U.S. Census Bureau data showed Thursday (1/29).

The U.S. goods and services deficit stood at $56.8 billion in November, up by $27.6 billion, or 94.6%,from a revised $29.2 billion in October, the Bureau of Economic Analysis, a unit within the Commerce Department, said in statement.

The increase came despite the services surplus growing by $29.8 billion, as the goods deficit more than tripled month-on-month, from $27.9 billion to $86.9 billion.

In November, U.S. imports rose 5% month-on-month to $348.9 billion, while exports fell 3.6% to $292.1 billion, the BEA release showed.

While the trade deficit nearly doubled from the 15-year low in October, it was still below long-term averages preceding the large-scale implementation of tariffs on goods imports into the U.S.

U.S. Nonfarm Business Productivity Up 4.9% in Q3 2025

Nonfarm business sector labor productivity grew by annualized rate of 4.9% in the third quarter of 2025, the Bureau of Labor Statistics reported Thursday (1/29)/.

Unit labor costs decreased by 1.9% during the period, reflecting a downward shift in the price of labor per unit of production for U.S. businesses.

This decline in costs occurred even as hourly compensation rose 2.9%, as productivity growth effectively offset higher wages.

In manufacturing, productivity grew 3.3% while unit labor costs rose 1.5%, highlighting a slightly different cost dynamic than the broader economy. These figures remained unrevised from earlier reports, suggesting that the industrial sector’s efficiency levels remained durable throughout the second half of the year.

Over the last four quarters, nonfarm productivity has increased 1.9%, signaling a steady post-pandemic trend of higher output per hour across the U.S. workforce.

Real hourly compensation, which is adjusted for consumer price changes, saw a 0.2% decrease despite nominal wage gains.

Valero’s Q4 Refining Segment Drives $1.7B Operating Income

Valero on Thursday (1/29) reported that its operating income nearly quadrupled to $1.7 billion in the fourth quarter of 2025, driven by strong performance in its refining and ethanol segments.

Valero also reported:

• Operational income in the fourth quarter of 2024 was $437 million.
• Refining throughput volumes averaged 3.1 million bpd in the fourth quarter of 2025, up from 3 million bpd in the fourth quarter of the prior year.
• The ethanol segment achieved record production volumes of 4.8 million gallons per day, contributing to a significant operating income of $117 million for the segment. In the fourth quarter of the prior year, ethanol output totaled 4.6 million gallons per day with a $20 million contribution to operating income.
• The renewable diesel segment reported $92 million in operating income, with sales volumes averaging 3.1 million gallons per day.  This was lower than the $170 million contribution to operating income and average volume of 3.4 million gallons per day in the comparative quarter of the prior year.