Oil commentary - 19 July 2016

Afternoon all. Brent closed last night at $46.96 down 0.65 and WTi closed at $45.24 down 0.71. This market seems as nervous as Piglet does on a blustery day. C-c-c-c-c-c-c-ccrude at F-f-f-f-f-fifty Pooh!! Look I'm going to say this until I am blue in the face - we are going through what seems one of the worst summers in history if you are a refiner. Here is a stat from a good friend of mine that sums things up right now - A 3% drop in refinery runs would reduce demand by more than 500,000 barrels a day and would have dire consequences for crude stocks and prices. Unfortunately, the US produces 600,000 barrels of gasoline more than it consumes and more than a million barrels of distillates, so you would need much bigger run cuts to start to eat into stocks. C-c-c-c-c-crikey. Good day.