Wkly EIA Gas Storage Report Was Bullish

CRUDE OIL

November Crude Oil extended this week’s rally overnight and traded to its highest level since August. The settlement of the dockworkers strike eases concerns about bottlenecks in both directions, and the jobs report this morning came in higher than expected, which eases some anxiety over the US economy that had crept into the market recently. Anxiety over Middle East supply has not eased, as analysts speculate over the likelihood that Israel would attack Iranian oil facilities and further escalate the conflict. Saudi Arabia and UAE appear to have capacity to make up for an interruption in Iranian supplies. Libya’s national oil company announced yesterday that its oilfields and export facilities have reopened after shutting down last month.

 

range gas

 

PRODUCT MARKETS

November RBOB is approaching key resistance at the 200-day moving average at 2.1310, which happens to coincide with the 0.618 retracement of the selloff from the July high to last month’s low.

 

NATURAL GAS

November Natural Gas traded to its highest level since July 3 overnight but backed off from that level and was lower on the day this morning. We suspect that the market has gotten overdone on the bullish trend in US supply and could be set for a correction. Weather forecasts for the Lower 48 suggest below normal heating degree days would outstrip above normal cooling degree days over the next couple of weeks, leading to lower than normal gas demand overall. Yesterday’s weekly EIA gas storage report was bullish, with storage for the week ending September 27 at 3,547 bcf, +55 bcf from 3,492 the previous week. This was a smaller than expectations calling for a build of 60 to 65 bcf. Storage was up 3.0% from a year ago and 5.6% above the five-year average versus +4.0% and +7.1% the previous week. The settlement of the port workers strike eases concerns about a potential disruption to US LNG exports.  November Natural Gas has an outside day lower going this morning, which could lead to a correction of rally off the September 3 low.

 

 

 

 

 

Interested in more futures markets?  Explore our Market Dashboards here.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2024 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

Latest News & Market Commentary

Explore the latest edition of The Ghost in the Machine

Explore Now