Outlook: The energy complex continues to retreat slightly this morning due to profit taking after recent highs. Demand optimism remains strong however and should keep prices from falling significantly lower. A stronger U.S. dollar and weakness in equities this morning also pressures prices. Recent strong price moves are likely being viewed as premature, especially with WTI futures attempting to touch $70 yesterday. Fresh fundamentals will be needed to maintain these higher price levels, as recent attempts were unsuccessful due to profit taking. Global economic reopening continues at a strong pace, with Britain expected to keep its plan to fully reopen on June 21. Traffic data has also shown recent increases in travel in both the U.S. and Europe. Overall, much of today’s weakness can be attributed to broader markets and inflation concerns. Some brief stalls in movement can be expected as traders balance out headlines regarding demand, Iranian production, and remaining Covid-19 issues.
- U.S. Census data showed that U.S. crude exports in the month of April reached 3.24 million bpd vs 2.61 million in March.
- Several Indian oil refiners are taking advantage of current weak demand in India to shut down for maintenance.
- The agency that monitors Tehran’s nuclear sites stated that the talks between Iran and world powers are entering a “decisive phase”. Diplomats are set to reconvene this week in Austria.
- Reuters reports that China’s crude imports in May were down by 14.6% as several Chinese refineries undergo maintenance. Additionally, heavy buying during the low oil prices a year ago has likely led to less needed supply.
- The July crude oil contract is trading $0.04 lower at $69.19. The 20-day and 100-day moving averages are $66.29 and $60.99 respectively. The 14-day RSI is 62.08%.
- As of 9:15 am CST: July Brent is down $0.35 at $71.14, the U.S. dollar index is 0.102 higher at 90.052, while the nearby e-mini S&P 500 futures contract is down 1.75 points at 4223.75.
- The July ULSD contract is trading $0.0023 lower at $2.1133. The 20-day and 100-day moving averages are $2.0518 and $1.8595, respectively. The 14-day RSI is 62.21%.
- Ford unveiled the first gas-electric hybrid engine pickup in America, the new Maverick truck that is slightly smaller than the F-150.
- The July RBOB contract is trading $0.0083 lower at $2.1848. The 20-day and 100-day moving averages are $2.1431 and $1.9536, respectively. The 14-day RSI is 57.41%.
- At last look, Conway propane was down $0.00500, trading at $0.8900. Mt. Belvieu was down $0.00250, trading at $0.91500.
- The USDA reported that U.S. corn is now rated at 72% G/E, down from 76% a week ago. Corn is also reportedly 90% emerged vs a 5-year average of 82%.
- Natural gas prices are seen rebounding this morning after yesterday’s losses. Support stems from hotter weather across the West coast and Midwest along with increasing gas flows to export terminals.
- The July Natural Gas contract is trading $0.107 higher at $3.177. The 20-day and 100-day moving averages are $3.038 and $2.891, respectively. The 14-day RSI is 63.27%.
|As of 9:15 AM CST||WTI July||ULSD July||RBOB July||Nat Gas July|