Morning Highlights
Morning Highlights

11-01-22 A stronger tone to start in crude, diesel, gasoline, propane...

Tony Headrick

Nov 1, 2022

Outlook: As the market awaits the interest rate decision by the FOMC tomorrow, a softer dollar helps provide a layer of price support. The dollar has recovered from earlier lows however as better than anticipated US manufacturing data suggests the Fed will continue to be aggressive.


  • OPEC’s secretary general said the world must act swiftly to invest in oil in order to prevent future energy emergencies and additional spare capacity investments are key to dealing with future supply shocks.
  • ISM Manufacturing PMI for October came in at 50.2, higher than 50.0 anticipated. A reading above 50 indicates expansion while a reading under indicates retraction.
  • S&P Global Chairman Daniel Yergin said Russia may start to "weaponize" oil in the form of reduced exports if sanctions are tightened.
  • Saudi Aramco's third quarter net income rose to $42.4 billion from $30.4 billion a year earlier.
  • A day after President Biden floated a windfall tax on energy companies if they don’t increase production, BP’s CFO said the main constraints to additional production are supply chain issues and the lack of people needed to do so.
  • Swap markets are pricing in a high likelihood of a 75 point rate hike this month followed by a 50 point increase in December.
  • There is speculation around markets that China may ease its Covid lockdown policies, however nothing has been officially substantiated by policy makers in this regard.
  • As of 10:30 am CDT: Brent crude oil up $2.08 to $94.89, US dollar index up 0.061 to 111.588 while the nearby e-mini S&P 500 futures contract is down 18.00 points to 3865.00.


  • After the November contract dropped off yesterday at 4.1909, the freshly minted prompt December contract is down 21 points today to 3.6719.
  • The EIA shows the national average on-road diesel price is $5.32.
  • Mid Atlantic Padd 1B stock levels will be watched closely in tomorrow’s Weekly Petroleum Status Report.


  • Job openings in September rose 437,000 to 10.7 million, BLS data showed. This was much greater than a 10.0 million reading anticipated. However, hiring has been trending down and is at 18-month lows.
  • The EIA shows the national average gasoline price is $3.57.
  • Marathon Petroleum sees a strong refining environment going forward.


  • Propane values are higher with Conway trades done in the 89-91 cent range.

Natural Gas

  • Natural gas continues to see large swings in value with today’s nearby December contract off 45.6 cents at 5.899.
  • Freeport LNG has yet to submit restart plans at its Texas facility to PHMSA, suggesting they will be delayed in restarting operations by mid-November timing they previously communicated. A Freeport spokesman said the company still intends to restart production this month.

December ULSD Futures: Although daily ranges remain sizeable, December ULSD has recently traded in a range from around $3.50 on the lower end and $3.80 on the upper end with current trade at roughly the mid-point at $3.6679.