Outlook: Energies are finding firmer footing this morning ahead of a busy slate. Crude is up over a dollar while products observe gains near 2 cents after hovering near unchanged earlier this morning. The market should find fresh drive from JOLTS Jobs and Jerome Powell's testification which will be shortly followed by the EIA inventory report. The Fed has maintained a more hawkish stance as of late stating they will not cut interest rates until they feel more confident and the expectation is that Powell will reiterate that stance today. Any indication of a more dovish tone would be supportive for the bulls. As for inventories, the industry estimates suggest refinery downturn is still impacting supplies given the dynamic of crude builds and product draws, however, demand will again be critical as an indication for the overall health of the economy. Diesel demand has remained sluggish at 5-year lows while gasoline demand sits in better shape, but also below 5-year levels.
Crude
- Saudi Aramco lifted its oil price to Asia by 20 cents to $1.70 for April. Price increases can be an indication of stronger demand.
- The Houthis struck another US-owned vessel in the Red Sea which led to evacuation.
- Crude spreads continue to expand, reflecting a tighter market and supporting the bull move.
- Reuters estimates crude stocks rose 2.6 million barrels last week.
- The API survey showed crude stocks rose by 423,000 barrels last week.
- The EIA will report inventories at 9:30 am CT.
- Fed Chair Jerome Powell will testify today a 9:00 am CT.
- Chinese import/export data will be reported overnight.
- As of 8:10 am CST: Brent crude oil up $0.80 to $82.84, US dollar index down $0.292 to 103.506 while the nearby e-mini S&P 500 futures contract is up 30.25 to 5116.00.
Diesel
- Reuters estimates diesel stocks fell 700,000 barrels last week.
- The API survey showed diesel stocks fell by 1.8 million barrels last week.
Gasoline
- Reuters estimates gasoline stocks fell by 1.6 million barrels last week.
- The API survey showed gasoline stocks fell by 2.8 million barrels last week.
Propane
- Conway is trading at .7625 while Belvieu is trading at .8075.
- Conway Swap Oct24-Mar25 strip indicative midpoint ~.8100.
- Propane will likely look to follow crude lower with US demand remaining soft.
Natural Gas
- Overnight weather runs removed 3 HDDs in the two week forecast.
- Cash spot natural gas prices in the Permian fell to minus 90 cents yesterday due to planned maintenance on the Permian Highway Pipeline.
- Reuters estimates nat gas stocks fell between 35 and 46 Bcf last week.
Continuous Daily WTI: WTI futures are finding support at the 200-day moving average. A continuation of bullish momentum may influence another test of $80 today.
