Morning Highlights
Morning Highlights

9.30.21 It’s a mixed start and it looks as though we may be seeing a turning of the corner

User Not Found

Sep 30, 2021

Outlook: It’s a mixed start and it looks as though we may be seeing a turning of the corner from earlier weakness. Despite an overall US petroleum build of more than 10 million barrels as reported yesterday by the EIA, the outlook is for continued drawdowns globally for the foreseeable future, which should lend overall support and limit downside. In fact, downside moves can be considered opportunities to buy for 2022 needs.   


  • OPEC+ meets next week where they will evaluate market conditions and make production plans for November forward. Currently they are scheduled to add 400,000 bpd in November.
  • As China reduces electricity use because of lack of supply, manufacturing decreased in September for the first time since the pandemic began.
  • The EIA yesterday reported a 4.6 million barrel weekly build in US crude stockpiles, the first build in two months.
  • US weekly jobless claims came in at 362,000, above estimate for a 330,000 reading.
  • Motiva’s Port Arthur refinery shut a crude unit due to a process upset.
  • Today is month-end and quarter-end, which can lead to added volatility in the markets.
  • As of 9:28 am CDT: November Brent is $0.61 lower to $78.03, the U.S. dollar index is 0.054 lower to 94.284 while the nearby e-mini S&P 500 futures contract is up 8.25 43.58.


  • Despite a 384,000 barrel US distillate build as reported from the EIA yesterday, US distillate supplies remain low compared to history. Currently ULSD is the strongest leg of the complex with gains near 60 points as of this writing.
  • Over the last seven days European air traffic is down 29% from 2019 levels and stood at 23,208 flights on September 29, down 0.4% w/w and down 1.6% from two weeks prior.


  • Road congestion levels are robust across the globe (see chart below). Despite the Delta variant we know enough about the virus, allowing us to move back towards normal across the world, which keeps the demand outlook positive.


  • With spot values in Conway near $1.41, consider the sharp backwardation where next fall/winter values are near $1.03. If you have interest in getting swap coverage early let us know we’ll pull up a fresh quote.
  • At last look, Conway propane was trading down $0.02500 at $1.40000. Mt. Belvieu was also trading down $0.02000 at $1.43000. 

Natural Gas

  • Asian JKM spot price for natural gas hit $34.47/mmbtu, a record. The energy supply situation does not look to improve anytime soon in Europe.
  • The EIA reported an 88 Bcf injection on its U.S. natural gas storage report, compared to the average estimate of an 87 bcf injection.
As of 9:30 AM CDT   WTI OctULSD OctRBOB OctNat Gas Oct
CONTRACT HIGH74.772.26822.21179.062
PREVIOUS CLOSE74.832.30752.22935.477
CONTRACT LOW31.251.14000.81482.193