Written on: September 3, 2021

Energy Price Report for September 2021

Friday, September 3, 2021

Energy futures are strengthening

Energy futures are strengthening on Friday amid gains in the US stock market futures and mostly higher trade in European equities.  Reuters reports that about 1.7mb/d of oil production is still shut in the Gulf of Mexico, with damaged heliports and fuel depots hampering the return of crews to offshore platforms.  Market traders are awaiting US economic news in the form of the Employment Situation Report and the ISM Services Index, as well as the weekly US rig counts from Baker Hughes for further direction.

Energy futures gained yesterday

Energy futures posted gains of over 1.8% yesterday amid a drop in Russian oil and gas condensate production last month, gains in global shares and weakness in the US dollar.  Brent crude rose $1.44 to $73.03 a barrel, WTI crude added $1.40 to settle at $69.99, gasoline futures jumped 5.26 cents higher to settle at $2.1635 per gallon, heating oil settled 3.88 cents stronger at $2.1677, natural gas futures edged up 2.6 cents to settle at $4.641 per MMBTU.

Hurricane Larry update

Hurricane Larry continues to move northwest towards Bermuda but is expected to weaken before it reaches the island. The NHC is tracking two more disturbances, one located over the Gulf of Honduras and the other located about 150 miles southwest of the Cabo Verde Islands, but it gives them both a near-zero chance of tropical cyclone formation.

Financial market update

The Japanese Services PMI (Markit/Nikkei) fell from 47.4 to 42.9 last month.  The Caixin China Composite PMI fell from 53.1 in July to 47.2 in August.  The Shanghai Composite closed 0.4% lower and the Hang Seng lost 0.7%, while the Nikkei rallied 2.1%.  In European news, the final Eurozone August Composite PMI (Markit) came in at 59.0, below expectations at 59.5.  The Composite PMI in Germany also missed expectations by coming in at 60.0 (vs 60.6), while the index for France matched forecasts at 55.9.  The final UK August CIPS/Markit Composite PMI came in at 54.8, below the Econoday consensus at 55.3.  Retail sales in the Eurozone fell 2.3% in July, while forecasts called for a 0.1% increase.  The CAC 40 is down 0.4% this morning, whereas the DAX had edged up 0.1% and the FTSE 100 had added 0.2%.  US stock market index futures are gaining around 0.15% this morning.  The US dollar index is steady.