NYMEX markets will close at 12:45 pm CT on Tuesday, December 24th in observance of Christmas. Markets will reopen at 5:00 pm CT on December 25th.
Outlook: The complex is looking to recoup yesterday’s losses but action remains limited in light pre-holiday trade. In the absence of a major headline, energies look comfortable within their recent range which could leave things in neutral to end the year. Crude continues to gravitate around $70 while timespreads have expanded slightly this week. The global fundamental picture remains bearish which continues to act as an upside limiter. The Fed has also adopted a more hawkish tone following the recent rate cut which may complicate demand growth domestically in 2025. Inauguration Day is circled on many calendars with an anticipated shift in policies creating the potential for renewed volatility. We'll look to the delayed EIA stats later this week for further fundamental influence.
Crude
- Sluggish global fundamentals remain an upside limiter across energies.
- Chinese officials plan to sell $411bn in treasury bonds in 2025, which triples last year’s sales and may support consumption and investments. (BBG)
- Fed Fund futures suggest Fed rate cuts of less than 40 bps in 2025, down from 125 bps after the cut in September.
- Continuous WTI is testing resistance at $70 today. A close above could be viewed as supportive short-term.
- Prompt WTI spread is firmer today which sheds bullish indications.
- Reuters estimates crude stocks fell 2 million barrels last week.
- The API will report its inventory survey at 3:30 pm CT today.
- As of 8:45 am CST: Brent crude oil up $0.70 to $73.33, US dollar index up $0.066 to 108.103 while the nearby e-mini S&P 500 futures contract up 21.25 to 6057.00.
Diesel
- Reuters estimates diesel stocks fell 1.1 million barrels last week.
- Nigeria’s Dangote refinery has reached 85% capacity or 550,000 bpd. (Reuters)
- Increasing is Nigeria’s refining is pressuring Europe’s gas and diesel exports.
Gasoline
- Reuters estimates gasoline stocks fell 2.7 million barrels last week.
- EU and UK gasoline exports are scheduled to fall to 874,000 bpd in December, down from 1.12 mbpd in November. (Reuters)
Propane
- Prompt Conway futures are trading at .7250 while Belvieu is trading at .7600.
- Conway Swap Oct25-Mar26 strip indicative midpoint ~.7400.
- Conway propane is trading at 45% to WTI.
Natural Gas
- Overnight weather runs removed 4 HDDs through the two-week forecast.
- US HDDs for the week ending Dec 21 fell by 12 w/w and are 34 HDDs below the long-term norm.
- Reuters estimates nat gas stocks fell between 100 and 94 Bcf last week.
Continuous Weekly NG: Natural gas isn’t going quietly into the holiday as it trades up 15 cents today. With the move this week, prompt weekly natural gas futures are testing the 200-week moving average for the first time in nearly 2 years.
