Outlook: Energies are recouping some of the losses observed after yesterday's bearish EIA report. The market found a boost early from a better-than-expected jobs report. A healthy labor market may contribute to more resilient energy demand, especially with a contracting manufacturing sector. Previous labor reports were revised lower which has been a trend that may dampen positive sentiment. Risk-on appetite ahead of the weekend could also be adding bullish sentiment with ongoing turbulence in the Red Sea. The nearby crude contract continues to test upper trendline resistance but a more convincing move will be necessary to illustrate a trend change.
Crude
- The shipping giant Maersk has extended its Red Sea shipping diversion until further notice.
- US Secretary of State Antony Blinken is set to visit the Middle East again in an effort to prevent further escalation.
- A Reuters survey shows OPEC December oil output rose 70,000 bpd.
- The contango in the prompt WTI spread has shrunk back under 10 cents today which trends towards tighter supply.
- The EIA reported US crude stocks fell by 5.5 million barrels last week.
- US crude exports rose by 1.3 mbpd to 5.2 mbpd.
- US nonfarm payrolls were reported at 216,000 vs 170,000 est.
- US ISM services PMI will be reported at 9:00 am CT.
- As of 8:31 am CST: Brent crude oil up $1.11 to $78.70, US dollar index up $0.130 to 102.556 while the nearby e-mini S&P 500 futures contract is down 0.25 to 4730.00.
Diesel
- The EIA reported diesel stocks rose by 10 million barrels last week.
- US diesel demand fell to its lowest levels since 1999 last week with a 33% decline.
Gasoline
- The EIA reported gasoline stocks fell 10.9 million barrels last week.
- The weekly increase in gasoline inventories was the largest since 1993.
- Gasoline demand fell 13% w/w to 7.9 mbpd.
Propane
- Conway is trading at .6800 while Belvieu is trading at .6950.
- Conway Swap Oct24-Mar25 strip trading ~.7300.
- The EIA reported propane stocks fell by 2 million barrels last week vs -1 million barrel est.
- The US is exporting 65% of propane production as of last week.
Natural Gas
- Overnight weather runs added 4 HDDs through the two-week forecast.
- The EIA reported nat gas stocks fell by 14 last week.
- Working gas inventories remain 339 Bcf higher than the 5-year average.
Continuous Daily WTI:
