Latest news

Outlook:  Slightly higher trade this morning as energies and equities recover from yesterday’s steep selloff. Prices in the energy market however have fallen off from their overnight highs this morning, as muted trade starts the day. Asian markets were also seen stabilizing after concerns regarding Evergrande, helping boost investor sentiment. Traders will likely remain cautious, especially going into the two day Fed meeting, however some have viewed yesterday’s selloff as a buying opportunity. Supply tightness should continue to buoy energy markets, with OPEC+ reportedly struggling to pump enough oil in August to meet rising demand. Increasing investments into renewables has caused for several members to be underinvested, and delays to mechanical work have also led to the inability to quickly increase production and meet recovering demand.

Crude

• Russia has increased its 2022 oil export forecast to 273.8 million tonnes, up by 6.7% from the previous projections. The natural gas exports forecast however, was revised down by 3.3% for 2022.
• Russia expects that its oil output in 2022 will hit a post-Soviet high, up 8% to 559.9 million tonnes.
• After months of delays, Iran has now reported that the talks to revive the 2015 nucleal deal are expected to restart in the next few weeks.
• The October crude oil contract is trading $0.30 higher at $70.59. The 20-day and 100-day moving averages are $69.38 and $67.87 respectively. The 14-day RSI is 55.36%.
• As of 8:45 am CST: October Brent is up $0.53 at $74.45 and the U.S. dollar index is 0.103 lower at 93.173 while the nearby e-mini S&P 500 futures contract is up 30.00 points at 4378.25.

Diesel

• European refiners were seen producing 4.88 million bpd of middle distillates in August, up by 4.3% month-on-month and 3% year-on-year.
• A trusted analyst expects that diesel demand will see a 250,000 bpd demand boost in Asia this winter as China is expected to fall back on the fuel as LNG prices soar.
• The lifting of U.S. travel bans for foreign vaccinated individuals could add as much as 200,000 bpd of jet fuel demand.
• The October ULSD contract is trading $0.0173 higher at $2.1763. The 20-day and 100-day moving averages are $2.1417 and $2.0972, respectively. The 14-day RSI is 56.22%.

Gasoline

• European refiners produced approximately 2.2 million bpd of gasoline in August, up by 1.6% from July and up 3.7% from July 2020.
• The October RBOB contract is trading $0.0017 lower at $2.1135. The 20-day and 100-day moving averages are $2.0761 and $2.0216, respectively. The 14-day RSI is 49.80%.

Propane

• Yesterday’s updated crop progress report showed that U.S. corn was 57% mature vs the 5-year avg of 47%. The report also stated that corn harvest is now 10% complete vs a 5-year avg of 9%.
• At last look, Conway propane was trading down $0.00250 at $1.33250. Mt. Belvieu was trading down $0.00250 $1.33250.