Outlook: Energy futures are seen slipping lower this morning as demand concerns mount and a strengthening U.S. dollar leads to additional pressure. Light volumes this morning also add to weakness in crude and products. Demand concerns have increased this morning after it was reported that Saudi Arabia had lowered its official selling price for Asia. Additionally, last Friday’s disappointing jobs report also continues to pressure markets, with equities falling lower after the open. Losses going forward however should be limited by the persisting outages after Hurricane Ida.
- Saudi Arabia cut its Arab light crude selling price for Asia delivery for the first time in four months, down by $1.30 per barrel.
- According to a report by Reuters, more than 80% of the U.S. oil production in the Gulf of Mexico remains offline more than a week after Hurricane Ida.
- Royal Dutch Shell has begun its process of redeploying staff to its Gulf of Mexico facilities. Currently about 80% of Shell-operated production in the GOM is still offline.
- China’s August crude oil imports were seen rising by 8% in August compared to July as refiners ramp back up due to expectations of increasing demand.
- The October crude oil contract is trading $0.59 lower at $68.70. The 20-day and 100-day moving averages are $67.49 and $67.50 respectively. The 14-day RSI is 49.54%.
- As of 8:45 am CST: October Brent is down $0.23 at $71.99 and the U.S. dollar index is 0.347 higher at 92.382 while the nearby e-mini S&P 500 futures contract is down 12.75 points at 4521.75.
- Brazil has reduced its minimum biofuel content in diesel fuel from 13% down to 10%, citing the recent jump in soy prices.
- The October ULSD contract is trading $0.0230 lower at $2.1364. The 20-day and 100-day moving averages are $2.0803 and $2.0723, respectively. The 14-day RSI is 52.74%.
- According to a report from the U.S. Department of Energy, about 1.3 million bpd of refining capacity has restarted as power is restored in the Gulf Coast.
- The October RBOB contract is trading $0.0166 lower at $2.1374. The 20-day and 100-day moving averages are $2.0860 and $2.0375, respectively. The 14-day RSI is 52.04%.
- The story remains the same for propane, with inventories and days of supply both low as we head into the demand season with crop drying and home heating picking up.
- At last look, Conway propane was trading down $0.00500 at $1.19000. Mt. Belvieu was trading down $0.00250 at $1.19500.
|As of 8:45 AM CST||WTI October||ULSD October||RBOB October||Nat Gas October|