Written on: June 2, 2025
Monday, June 2, 2025
Energy futures are seeing large gains of over 4% this morning amid news of no change to OPEC+ output hikes, heightened geopolitical tensions between Russia and Ukraine and a selloff in the US dollar index, despite losses in global equities.
Market traders are looking ahead to the final May US Manufacturing PMI, the ISM Manufacturing Index and to US construction spending data for further direction.
Bloomberg reports that OPEC+ decided to stick with its planned 411kb/d July production increases in their meeting over the weekend. OPEC+’s decision to hold off on further output hikes has dampened oversupply concerns in global markets, per Bloomberg. Also in the news, geopolitical tensions in Europe have heightened further as Ukraine struck air bases deep in Russia, despite ongoing attempts from the US to facilitate a means to an end in the ongoing Russia-Ukraine conflict.
In India, the final Manufacturing PMI for May came in at 57.6, down from 58.2 in April and below the 58.3 flash reading. Asian stock markets closed lower overnight with Hong Kong’s Hang Seng down 0.57% and with the Nikkei in Japan dropping 1.30% lower. The Shanghai Stock Exchange was closed for a holiday. In economic news from Europe, the final French (49.8) and UK (46.4) S&P Global Manufacturing PMI for May came in above the 49.5 and 45.1 flash readings, respectively. The index the Germany, on the other hand, came in at 48.3, below the 48.8 flash estimate. For the Eurozone as a whole, the final May Manufacturing PMI showed a 49.4 point, matching expectations. European shares were trading flat-to-lower this morning as the UK FTSE 100 had edged up 0.03%, while the German DAX had lost 0.30% and the French CAC 40 had dropped 0.47% lower.
Futures for the major US stock market indexes saw losses of between 0.24% (Dow futures) and 0.49% (Nasdaq futures). The US dollar index had sold off 0.60% which is supportive for crude oil prices.
Brent crude settled 25 cents weaker at $63.90 a barrel, WTI crude fell by 15 cents to settle at $60.79 a barrel, heating oil lost 3.10 cents to close at $2.0172 per gallon, gasoline futures fell by 2.10 cents to reach $2.0384 per gallon and natural gas futures turned back south to end last week, falling 7.5 cents to settle at $3.447 per MMBTU.