Written on: November 1, 2022

Energy Price Report November 2022

November 1, 2022

Energy Futures are Flat

Energy futures are seeing flat-to-higher trade as of this writing on Tuesday, with weakness in the US dollar index as the two-day Federal Open Market Committee meeting got underway and with strength in European shares and in futures for the major US stock market indexes.  Market traders are looking ahead to US labor market, manufacturing and construction spending data for further direction.

Overseas Markets

Asian share prices strengthened last night. The Nikkei added 0.33%, the Shanghai Composite strengthened 2.62%, and the Hang Seng rallied sharply to post gains of 5.23%. The Nikkei/S&P Global India Manufacturing PMI rose from 55.1 to 55.3 last month, indicating expansion in the sector accelerated. In UK news, the CIPS/S&P Global Manufacturing PMI fell by less than expected, from 48.4 to 46.2, beating the 45.8 consensus forecast. The Nationwide House Price Index, however, showed a 7.2% yearly increase in home prices, below expectations at 8.3%. Still, the UK FTSE 100 was up 1.4% this morning, while the German DAX had gained 1.3%, and the CAC 40 in France was up 1.8%. Futures for the major US stock market indexes were seeing gains as well this morning, with Dow futures up 0.6%, S&P 500 futures having gained 0.9%, and Nasdaq futures strengthening 1.2%. Also supportive for crude prices, the US dollar index was falling by 0.6%, after rising for the last three sessions.

Energy Prices Fell

The energy complex fell for a second session on Monday, with weakness in US equities amid disappointing economic data and with a third session higher for the US dollar against a basket of currencies.  Brent crude lost 94 cents closing at $94.83 a barrel and WTI crude dropped $1.37 to settle at $86.53 a barrel.  Losses were wider on the product end of the barrel as futures sold off on expiration day.  November gasoline futures lost 9.59 cents to go off the board at $2.8107 per gallon and heating oil tumbled 35.89 cents lower to settle at $4.1909 per gallon.  Natural gas futures shot up 67.1 cents to settle at $6.355 per MMBTU.

Weather Outlook

The latest 1-5 and 6-10 day outlooks based on the European model continue to call for above-normal temperatures in the Midwest and Northeast. In other weather news, there is some late-season storm activity, with Tropical Storm Lisa headed towards the Yucatan peninsula and with another disturbance in the open Atlantic being granted a 70% chance for tropical cyclone formation by the National Hurricane Center. It is expected to move in a northeasterly direction away from the US.