Written on: September 3, 2024
Tuesday, September 3, 2024
Energy futures are trading mostly lower as of this writing on Tuesday morning, amid losses in global stock market indexes and further strength in the US dollar index, despite fresh Red Sea attacks and curtailed Libyan oil exports.
Reuters reports that Iran-backed Houthis attacked two crude oil tankers yesterday, which the US military called “reckless acts of terrorism.” One tanker was bore the flag of Panama, and another the flag of Saudi Arabia. In other supportive news from the region, major Libyan ports continue to see a halt on oil exports after over half of the country’s oil production was shut in due to a conflict between the Tripoli-based government and the government in the eastern part of the country, over the leadership of the central bank.
In economic news, the final August Nikkei/S&P Global Manufacturing PMI for India came in at 57.5, a surprise downward revision from the 57.0 flash estimate. Data on the vast Chinese manufacturing sector were mixed. The official National Bureau of Statistics manufacturing PMI for August fell to a six-month low of 49.1, but the Caixin/S&P Global PMI rose from 49.8 to 50.4, beating the 50.0 forecast. The Shanghai Composite lost 0.29% and the Hang Seng fell by 0.23%, but the Nikkei shed just 0.04% and the Asia Dow rose by 0.08%. In European news, Italian GDP growth was confirmed at 0.2% in the second quarter, as expected. The final August French (43.9), German (42.4), and Eurozone (45.8) S&P Global Manufacturing PMI all saw surprise upward revisions from their flash estimate. The CIPS/S&P Global UK Manufacturing PMI was kept unrevised at 52.5, as predicted. As of this writing, the UK FTSE 100 had lost 0.5%, while the German DAX had fallen by 0.3% and the French CAC 40 had shed 0.2%. Futures for the major US stock market indexes were also trading in the red, with Dow and S&P 500 futures down by 0.5% and Nasdaq futures having lost 0.7%. Also unsupportive for crude oil prices, the US dollar index was up by 0.2%.
The complex saw losses of between 1.4% (ULSD) and 3.1% (WTI) on Friday, with a continued rebound in the US dollar, flat-to-lower European equities trade, and indications from Reuters sources within OPEC+ that the group may well go forward with output increases in October. WTI crude sold off by $2.36 to settle at $73.55 a barrel, Brent crude lost $1.14 to close at $78.80 a barrel, gasoline futures dropped 3.60 cents lower to settle at $2.2117 per gallon, heating oil settled 3.25 cents weaker at $2.2515 per gallon and natural gas futures edged down by one cent to settle at $2.127 per MMBTU.
The National Hurricane Center is tracking three disturbances in the Atlantic but gives them all low chances of 10 percent or less for tropical cyclone formation over the next two days.
