Oil futures were giving back a chunk of the gains from post-Christmas trading Wednesday in one of the final trading sessions of 2023.

It is difficult to get a read on a true direction the market is taking as volumes are low, and based on the latest data from the CME Group, RBOB volumes on Tuesday came in at less than 100,000 total lots for the first time since early March.

Wednesday's activity appears to be mostly book squaring into the last couple of trading days of the year as headlines have been light in terms of market moving news. The market is still watching for impacts from shippers opting against moving vessels through the Red Sea, but other than higher shipping costs and longer delivery times, there has been no impact on production.

After rising by some $2 on Tuesday, both West Texas Intermediate and Brent were giving back that move, with both contracts off by about $1.25 heading into midday and holding just above the earlier lows. At 11:50 a.m. ET, front-month WTI was down $1.20 at $74.38/bbl with the February Brent contract off $1.26 at $79.81/bbl. Like refined products, the March Brent contract is catching more volume and trading down just over $1 at $79.79/bbl as Brent struggles to maintain the $80 level.

Refined products were heading in opposite directions as ULSD futures slipped and RBOB managed to stretch a bit higher.

Total volumes throughout the year for products will at times have a day below 100,000 lots, but the total volume in RBOB on Tuesday was the lowest since Christmas Eve 2020. The light volumes allow for a bit more whipsaw action and that is on display.

For a day where volumes are light, both January and February RBOB see roughly 5cts separating the high and low trades Wednesday. At publication time, front-month RBOB was trading 1.74cts higher at $2.1757/gal with February at $2.1839/gal, up just over a cent.

Cash markets are mostly higher this morning thanks to the futures gains, but San Francisco CARBOB is seeing prices jumping by 6.5-7cts as premiums continue to ramp up.

The diesel market is falling, and if the losses hold, prices will have fallen in four of the past five sessions. A relatively mild late December is keeping a lid on prices heading into the new year as the January contract most recently traded at $2.6459/gal, down 2.29cts, with February last printing at $2.6254/gal, down 2.29cts as well.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

--Reporting by Denton Cinquegrana, dcinquegrana@opisnet.com; Editing by Michael Kelly, mkelly@opisnet.com

(END) Dow Jones Newswires

December 27, 2023 12:36 ET (17:36 GMT)