Outlook: Energy markets are finding strength to kick off the New Year. The positive momentum over the last few sessions has crude, gas, and diesel testing breakout moves. WTI closed above its 100 DMA earlier this week and it’s testing the November high this morning. Diesel has found a tailwind along with propane and natural gas due to a colder-than-normal weather system moving through a large part of the US. Continuous HO is trading near its 200 DMA which is hasn’t traded above since February. Energies are continuing to push to fresh highs here this morning and the release of the EIA Weekly Petroleum Stats at 10:00 am CT should provide fresh influence.
Crude
- US crude production rose to a record 13.46 mbpd in October, up 260,000 from September. (EIA)
- US oil demand rose to its highest level since the pandemic in October at 21.01 mbpd, up 700,000 bpd from September. (EIA)
- Western Canadian monthly oil exports by tanker have fallen to their lowest level since September at 341,000 bpd. (BBG)
- In China, the Caixin manufacturing purchasing manager index fell to 50.5 in December from 51.5 in November.
- US manufacturing data will be reported tomorrow at 9:00 am CT.
- WTI crude closed above its 100 DMA on Tuesday. The 200 DMA sits at $75.64 on the continuous chart.
- The API survey showed crude stocks fell 1.4 million barrels last week.
- Reuters estimates crude stocks fell 2.8 million barrels last week.
- The EIA will report inventories today at 10:00 am CT.
- As of 8:39 am CST: Brent crude oil up $1.26 to $75.90, US dollar index down $0.332 to 108.819 while the nearby e-mini S&P 500 futures contract up 4.25 to 5940.00.
Diesel
- Continuous HO is approaching its 200 DMA near $2.3651 which could be an area of resistance.
- The API survey showed diesel stocks rose 5.7 million barrels last week.
- Reuters estimates diesel stocks rose 3.5 million barrels last week.
Gasoline
- Continuous RBOB is testing resistance at its 100 DMA near $2.0384.
- The API survey showed gasoline stocks rose 2.2 million barrels last week.
- Reuters estimates gasoline stocks rose 400,000 barrels last week.
Propane
- Prompt Conway futures are trading at .8050 while Belvieu is trading at .8225.
- Conway Swap Oct25-Mar26 strip indicative midpoint ~.7750.
- Conway propane is trading at 46% to WTI.
- OPIS estimates propane stocks fell 3.2 million barrels last week.
Natural Gas
- Overnight weather runs removed 3 HDDs through the two-week forecast.
- Reuters estimates natural gas stocks fell between 127 and 141 Bcf last week.
- The EIA will report inventories tomorrow morning at 9:30 am CT.
Continuous Daily HO:
