Outlook: Energies are rebounding this morning after the weakness observed to end last week’s session. Crude and products are all trading higher with diesel leading the complex. Trade is expected to be light today with the shortened holiday session. Headlines are light to start the morning which could leave the market susceptible if any market movers develop. Macroeconomic reports are also on the light side for this week's front half, which could leave more trade emphasis on fundamentals. The EIA inventory report will be delayed till Thursday at 10:00 CT.
Crude
- Chinese crude imports are expected to rise between 500,000 – 1 million bpd this year, according to a survey response from Wood Mackenzie, FGE, Energy Aspects, and S&P Global Commodity Insights.
- According to the IEF citing JODI, Saudi Arabia’s crude exports rose 196 kbpd to 7.44 mbpd in December.
- Saudi Arabia’s oil products exports rose 222,000 bpd to 1.4 mbpd in December.
- Saudi Arabia’s demand for oil and products rose 22,000 bpd to 2.399 mbpd.
- Saudi’s energy minister said today that OPEC+ decisions are not politicized and are based on market fundamentals, and the group is sufficiently flexible to adjust the policy as needed.
- Goldman Sachs expects crude prices to rise sequentially to $100/bbl by year-end.
- Nearby WTI is challenging its 50-day moving average resistance around $77.38 today.
- March crude will expire tomorrow
- As of 8:10 am CST: Brent crude oil up $1.20 to $84.18, US dollar index up $0.045 to 103.907 while the nearby e-mini S&P 500 futures contract is down 5.25 to 4082.00.
Diesel
- Germany’s Schwedt refinery is undergoing maintenance which will hold utilization rates below 50% in April and May, and won't surpass 75% for over 2 years. The refinery supplies 90% of Berlin’s fuel.
Gasoline
- The prompt RBOB contract has found support on its 50-day moving average near $2.3941.
- Goldman Sachs expects gasoline to average $3.90-$4.0 in 2023/2024.
Propane
- Conway is trading at .7950 while Belvieu is trading at .8250.
- Conway is trading at 43% of crude.
- The US is exporting 78% of production as of 2/10/23.
Natural Gas
- Natural gas is trading near unchanged today
- Natural gas prices have fallen $4.60 since the middle of December.
Chinese Imports: Chinese oil imports are expected to exceed 2020s record of 10.8 mbpd this year with growth near 11.8 mbpd. Throughput is also expected to increase with two new refineries totaling 520,000 bpd of capacity to come online in the coming months. China is expected to produce nearly half of 2023 global oil demand growth this year.
