The energy team will not be available tomorrow for OTCs and/or EFP's tomorrow. Futures orders can still be placed through any broker in the office. If you need any assistance please call 1-800-328-6530.
Outlook: Energies are mixed to start the week. Crude and gasoline are down on potential demand concerns from China as well as an extremely strong dollar that is up over a full point. Diesel is seeing some strength today that stems from a bullish demand number in last week’s report as well as tightening supplies, especially in the Midwest and east coast. Natural gas is also seeing gains today that likely stem from the smaller-than-expected inventory build last week and the European price increases.
Crude
- Chinese Covid cases rose again over the weekend bringing Chinese demand into question if more lockdowns start.
- A Russian court allowed a key export terminal to resume exports after they had previously been ordered to halt all exports.
- President Biden traveling to Saudi Arabia this week and will try to negotiate for more oil production from OPEC
- Indian energy demand reached its highest level in three months at 18.7 million barrels per day.
- Strength in the US Dollar has held many commodities down from potential rallies, especially in the energy market.
- The Spec funds have the fewest net long positions since February 2019 and sold nearly 25,000 contracts to be long 362,590 contracts
- Tomorrow the EIA will release its short-term energy outlook at 11:00 AM CT.
- As of 9:45 am CST: Brent crude oil down $1.52 to $105.50, US dollar index up $1.003 to 108.015 while the nearby e-mini S&P 500 futures contract is down 36 to 3865.25.
Diesel
- Refinery run rates have been great the last couple of months, but inventories are still declining.
- Tight supply is still providing support to the market.
Gasoline
- American prices at the pump saw the biggest single-day drop in over a decade and are currently averaging $4.72 per gallon.
- Some industry experts are concerned that consumer demand may remain strong through the summer demand season, but could see a significant lack of demand when summer ends.
Propane
- 1.1500 Conway and Belvieu at 1.1900
- There was a fire at a Oneok NGL facility in Oklahoma that has the market slightly concerned about supply.
Natural Gas
- Germany is still in fear that Russia could shut off its natural gas flows into Europe.
- NordStream One shut down today for a planned maintenance event.
- Weather forecasts are predicting a drier and hotter forecast for much of the US
US Crude Production: US rig counts were up again last week and much like most of the year the Permian basin is the region adding the most rigs back into production. Other areas have not added nearly as many but to be fair they do not have as many to add either.
