Outlook: The energy complex was mixed earlier this morning but has since found direction following a slough of economic reports released this morning. Nonfarm payrolls were widely anticipated this week after a hawkish Fed testimony this week, and a sharply higher-than-expected print in January. Payrolls increased by 311,000 which was a m/m decline but above the estimate. Overall, the market appears to have had this range priced in with the dollar sinking further post-report. A weaker dollar could make US products more favorable for holders of other currencies, while crude exports just recently fell from record levels. Look for volatility to continue as the market breaks down the balance of economic headwinds and rising demand between China and India.
Crude
- WTI is on pace for a weekly decline of around 5%.
- OPEC+ is expected to stick with its current production cut of 2 mbpd.
- Deliveries from France’s TotalEnergies’ refineries were blocked from leaving for a fourth consecutive day today.
- The DOE announced the sale contracts of its next batch of SPR releases. They will release 26 million barrels from April-June and it is the last scheduled release until 2026.
- Analysts now see it as a toss-up for whether the Fed will hike rates by 25 or 50 bps at their next meeting in two weeks.
- February Nonfarm payrolls were reported at 311k vs 205k est.
- February CPI will be reported on Tuesday next week.
- As of 8:03 am CST: Brent crude oil up $0.57 to $82.16, US dollar index down $0.516 to 104.796 while the nearby e-mini S&P 500 futures contract is up 11.25 to 3930.00.
Diesel
- AAA reports the national average retail diesel price at $4.364 today vs $4.388 a week ago.
- Gasoil and jet fuel stocks declined at the ARA hub this week.
Gasoline
- AAA reported the national average retail gas price at $3.474 today vs $3.390 a week ago.
- The April gasoline contract trade through its 200-day and 50-day moving average yesterday and is testing its 100-day moving average support today near $2.5914
- Gasoline stocks at the ARA hub declined this week.
Propane
- Conway is trading at .7900 while Belvieu is trading at .8450.
- Conway is trading at 43% of crude.
- The US is exporting 57% of production as of 3/3/23.
- An Oct-Mar propane swap for 42k/mo was offered at 89.5 cents yesterday. Please reach out for updated pricing.
Natural Gas
- US Natural gas demand fell to 111.0 Bcf yesterday.
- Weekend weather runs removed 2 HDDs through the two-week forecast.
- The EIA reported an 84 bcf withdrawal from storage last week.
- The 5-year average draw is 101 Bcf.
- Inventories are 21% above the 5-year average.
Continuous Daily HO: The prompt diesel contract is finding strength today after a testing nearby support. The contract briefly traded below its lower Bollinger-band, which can indicate an oversold market. The contract is also receiving support from a weaker dollar following this morning's economic reports.
