Outlook: The energy complex seems to be heading into the weekend on a strong note. Currently U.S. crude prices are up by over 4% on the week, while products are set to see gains of around 3%. Prices continue to find support from robust economic recovery, a bullish sign for demand in the second half of the year. Additionally, yesterday’s EIA report showed crude inventories falling for their second consecutive week, as stockpiles continue to ease. Iran talks have also slowed, lending additional strength to prices. A U.S. State Department spokesman stated yesterday that there should be a sixth round of talks between the U.S. and Iran, and possibly continue to more rounds beyond that. Equities also trade higher this morning, making up for some of yesterday’s losses. A weaker than expected U.S. jobs report caused the dollar to slip and aided Equities as investors view it as a sign the Fed will keep rates low. Signs of strong economic recovery had led to the idea that the Fed might slow down its bond buying and also raise rates. Overall demand recovery should continue to support markets, but traders will remain cautious of slower vaccination rates in Asia and also watchful of headlines regarding Iran.
- Nonfarm payrolls increased by 559,000 jobs in May, below the average estimate of 671,000 jobs. The unemployment rate however fell from 6.1% to 5.8%, better than the expected 5.9%.
- Russian Deputy Energy Minister Novak reported that Russia’s OPEC compliance for May was close to 100%, up from 91% in April.
- Citigroup analysts stated that current speculative positioning in oil is relatively low, which could lead to more financial flows into the oil market in coming months.
- Two of Russia’s top energy CEO’s stated that they expect OPEC+ to ramp up output as the market heats up, stating that it could be as soon as the July meeting.
- The July crude oil contract is trading $0.80 higher at $69.61. The 20-day and 100-day moving averages are $65.87 and $60.66 respectively. The 14-day RSI is 66.42%.
- As of 8:40 am CST: July Brent is up $0.79 at $72.10, the U.S. dollar index is 0.442 lower at 90.070, while the nearby e-mini S&P 500 futures contract is up 24.75 points at 4216.00.
- Asia to West jet fuel exports are seen up by 32% in April-May compared to Feb-March. Several global companies are ramping up exports from Asia to Europe and the U.S. as commercial travel ramps up again.
- The July ULSD contract is trading $0.0154 higher at $2.1171. The 20-day and 100-day moving averages are $2.0412 and $1.8490, respectively. The 14-day RSI is 63.21%.
- The national average gas price according to AAA currently sits at $3.047, up from last week’s average of $3.044.
- The July RBOB contract is trading $0.0162 higher at $2.2180. The 20-day and 100-day moving averages are $2.1374 and $1.9428, respectively. The 14-day RSI is 65.08%.
- At last look, Conway propane was down $0.01000, trading at $0.88250. Mt. Belvieu was up $0.00750, trading at $0.91000.
- Asian LNG prices rose for a second week due to strong demand in China and Europe. Last month China was seen importing around 7 million tonnes of LNG, a record for the month of May.
- The July Natural Gas contract is trading $0.008 higher at $3.049. The 20-day and 100-day moving averages are $3.023 and $2.885, respectively. The 14-day RSI is 55.69%.
|As of 8:40 AM CST||WTI July||ULSD July||RBOB July||Nat Gas July|