Crude is Lowest since Early 2004. WTI Crude dipped into the low 30’s this afternoon as concerns about demand and oversupply pressure the market.

China’s economy has had a crazy new year in its stock market the past week. Dropping day after day starting Thursday when the People’s Bank of China decreased the value of the yuan, pushing the countries stock market down over 7%. The Chinese government then shut down trading after passing regulations to limit volatility which closed the market at drops of 7%. This so called “circuit breaker” law was removed today after it created more fear than benefit.

Chart of Shanghai Composite Index Stock Market Closes

The economic uncertainty in China has spread to Japan, Australia and the US as traders are afraid of the economic impact of China’s economy. The Dow Jones Industrial Average is down 2.32% today and the NASDAQ down 3.03%.

This is also not helping the oil markets as China is the second largest user of oil in the world. Crude dropped to $33.17/bbl near end of day Thursday, down 80 cnts from the previous day close. WTI RBOB (gas) was down 1.12 cnts/gal and ULSD down 1.71 cnts/gal from its previous close of 1.0807 yesterday.

Crude Chart from 2002 to Present

With inventories still near all-time highs, traders are expecting the market to continue to drop with several considering the possibility of $20/bbl crude.

If you’re looking to lock in any fuels for summer use, give us call as now would be a good time to start thinking about it.