The Energy Report gave an early warning about the state of the crude market we are in now. We warned producers and users of oil, gas, and diesel to hedge. Now there are reports of airlines reducing capacity and businesses that are struggling due to higher crude and product costs. The recent oil price strength was born in the price crash in 2015 as it forced companies to cut investment and incorrect assessments about shale oil and the outlook for demand. Now the global oil market is in a precarious state and now almost everyone is aware of and concerned about the tight market conditions that increase the possibility of supply shock prices as global inventories are not sufficient to alleviate shortages.

One area of concern is supply in the U.S. delivery point in Cushing Oklahoma. Due to record U.S refining demand and Canadian oil sands outage by Suncor Syncrude, sent supplies in that delivery point to a 3 and a half year low. It looks like those supplies are still tightening. The Kyber Weekly Cushing Report showed that supply fell another 1,062,210 million barrels last week. The market needs Syncrude to get back online, the company has released a return to service plan.

The expectation that one coker, producing approximately 150,000 bbls/d, will return to service during the second half of July; the expectation that a second coker, producing approximately 100,000 bbls/d, will return to service during the first half of August.

U.S. oil production must continue to rise to replace spare production capacity that was wiped out across the globe to short-sighted thinking. There was good news on that front as energy companies last week increased the number of rigs drilling for oil by five to 863, up 100 year-on-year.

Reuters reported that the Syrian military air defenses struck an Israeli warplane and shot down Israeli missiles targeting the T4 air base in Homs province in response to an act of "aggression" on Sunday night, Syrian state media said. Increasing geopolitical risk is a factor that could keep us supported today. Even in the aftermath of the so-called trade war with China.

The Wall Street Journal reports in Pricier Fuel to Test Airline Profits that Jet fuel prices have been rising and under hedged airlines are looking for ways to stay profitable. There is a talk of reduced capacity and rising fare prices. Delta earnings this week will offer clues on industry plans for tackling higher costs according to the Journal.

DTN reported that Renewable Identification Numbers, credits that show compliance with the Renewable Fuel Standard were discussed lower Friday afternoon, quickly extinguishing a late Thursday afternoon relief rally sparked by the resignation of Scott Pruitt as Environmental Protection Agency administrator. Market participants said they were divided as to whether soon to be EPA Administrator Andrew Wheeler would change current ethanol policies, which has led to a rapid erosion of RIN values in 2018. Wheeler, EPA's deputy administrator, moves to the top slot on Monday (7/9).

Gas price increase in Haiti was causing riots. In Port-au-Prince, the AFP reports that Haiti’s President Juvenile Moise called on protesters late Saturday to "go home" after the suspension of a fuel price hike that triggered violent protests and left at least two dead in the Caribbean nation.

In an address broadcast on state television, Moise said he had "corrected what had to be corrected" following an about-face on the price increases earlier that day. "As soon as you speak, I listen. Because you started sending me this message last night, I received it and corrected what had to be corrected," Moise said. "To those watching me tonight, I ask you all: go home," he said, adding authorities had been directed to clean the streets.  The capital Port-au-Prince and its environs have stood paralyzed since Friday afternoon, with major routes blocked by barricades, some made of burning tires, and some protesters even calling for a revolution in the impoverished country.

Oil is taking a break but our beginning of the year target of hitting $80 is on target. Many others are now joining that call Natural gas heat wave is keeping market supported. We are seeing record production in the U.S.