Outlook: Energies are continuing lower today with crude and refined products observing marginal losses while natural gas holds small gains. A rare winter storm working across the Gulf put many refineries at risk of disruption due to abnormal operating conditions. To this point, the disruptions reported have been limited. Crude supplies have seen a more significant disruption with cold weather knocking off over 130,000 bpd of production in North Dakota. Globally, new Russian sanctions are showing signs of redirecting flows. Additionally, container liner MSC said it will continue to send ships around Africa’s southern tip despite the ceasefire agreement between Israel and Hamas. New sanctions on Iranian oil have yet to be mentioned since Trump has taken office but still looms at potential upside risk. Inventory stats are delayed by a day due to the Monday holiday this week so we’ll see the API’s this afternoon and the EIA stats tomorrow late morning.
Crude
- Trump said late on Tuesday that his administration was discussing imposing a 10% tariff on goods imported from China on February 1st. This would be in addition to the 25% tariffs on Canada and Mexico. (Reuters)
- North Dakota’s oil production is estimated to be down by 130,000-160,000 bpd due to extreme cold weather. (Reuters)
- Saudi Aramco’s CEO Amin Nasser said he sees 1.3 million bpd of oil demand growth this year.
- Continuous WTI is testing its 200 DMA at $75.18.
- Reuters estimates crude stocks fell 1.2 million barrels last week.
- The API will report its inventory survey this afternoon at 3:30 pm CT.
- The EIA will report inventories tomorrow at 11:00 am CT.
- As of 8:36 am CST: Brent crude oil down $0.18 to $79.12, US dollar index up $0.018 to 108.080 while the nearby e-mini S&P 500 futures contract up 30.25 to 6114.00.
Diesel
- February HO saw a key reversal lower yesterday.
- Continuous HO is testing support at its 9 DMA near $2.5434
- Diesel may be finding pressure from moderating temperatures in the Northeast.
- Reuters estimates diesel stocks were near unchanged last week.
Gasoline
- Refinery disruptions due to the winter storm working through the Gulf Coast has been limited thus far.
- Continuous RBOB closed below its 9 DMA yesterday.
- Reuters estimates gasoline stocks rose 2.3 million barrels last week.
Propane
- Prompt Conway futures are trading at .9275 while Belvieu is trading at .9400.
- Conway Swap Oct25-Mar26 strip indicative midpoint ~.8100.
- Conway propane is trading at 52% to WTI.
Natural Gas
- Weekend weather runs were unchanged through the two-week forecast.
- All three trains at Freeport LNG have been knocked offline due to a power issue. (Reuters)
- Reuters estimates nat gas stocks fell between 230 and 252 Bcf last week.
Continuous Daily WTI:
