Thursday, May 1, 2025
Energy prices are extending its losses of over two percent as of this writing on Thursday morning. Losses came amid continued strength in the US dollar index and news of possibly another sharp increase in OPEC+ output next month, despite a rally in US stock market index futures. Market traders are looking ahead to the final US S&P Global Manufacturing PMI, the ISM Manufacturing Index, weekly jobless claims figures and to US construction spending data for further direction.
Reuters reported that Saudi officials told OPEC allies that the kingdom can endure a period of lower prices, reinforcing expectations that the group could agree to another sharp increase in oil production when they meet next week.
The Bank of Japan kept its rates steady at 0.5%, as widely expected. The Nikkei closed 1.13% higher. The Shanghai and Hong Kong Stock Exchanges were closed for Labor Day today, and so were the Frankfurt and Paris Stock Exchanges. In the UK, the final S&P Global Manufacturing PMI for April came in at 45.4, beating the 44.0 flash estimate. Nevertheless, the FTSE 100 was trading just below the unchanged mark as of this writing, down by 0.1%. US stock market index futures are trading higher this morning, seeing gains of between 0.8% (Dow futures) and 1.9% (Nasdaq futures). The US dollar index was up 0.4% as of this writing.
Crude oil and refined product futures lost ground yesterday amid losses in US equities and some strength in the US dollar index, despite bullish crude oil inventory data from the EIA and gains in European shares. Brent crude lost $1.13 to close at $63.12 a barrel, WTI crude dropped $2.21 lower to settle at $58.21 a barrel, gasoline futures fell 3.42 cents, settling at $2.0370 per gallon, heating oil tumbled 8.37 cents to $2.0367 per gallon and natural gas futures fell by 6.0 cents to settle at $3.326 per MMBTU.
Energy Price Report
April 2, 2025
Crude oil and refined products futures are trading flat to lower this morning with bearish weekly API crude stock data and losses in equities likely weighing on the price action, whereas a weaker dollar and slower Kazakh oil exports were supportive factors. Market participants are looking ahead to the March ADP US Employment Report and to factory orders figures for February for further direction, along with the weekly EIA petroleum inventory report.
Bloomberg reports that two of three moorings at a Black Sea export terminal have been suspended by the Caspian Pipeline Consortium after an order from the regulator. While the Kazakh Energy Ministry says shipments are on schedule, as each mooring can load at a rate of 80,000 barrels per hour, it would be impossible to match the 1.7mb/d loaded in March. Neither the specific problem nor a timeline for resolution were provided.
In bearish US news, the API reported a 6.04mb build in crude stocks for the week ended last Friday, against expectations for a 0.5mb dip (average of surveys conducted by Bloomberg and the Wall Street Journal). Distillate stocks were virtually unchanged, in-line with expectations for a 0.6mb dip, and a 1.60mb draw from gasoline inventories was consistent with expectations (-1.44mb) as well. Analysts surveyed by OPIS are looking for a 0.24mb decline in propane/propylene stocks in today’s EIA report.
In economic news this morning, the Nikkei/S&P Global India Manufacturing PMI for March was finalized at 58.1, an upward revision from the 57.6 flash estimate and higher than the February print of 56.3 – indicating expansion in the sector accelerated. The Nikkei rose by 0.28% last night, and the Shanghai Composite edged up 0.05%, but the Hang Seng closed down 0.02%. European shares were falling back this morning, with the UK FTSE 100 and French CAC 40 both down by 0.8% and the German DAX having dropped 1.5% lower as of this writing. Meanwhile, futures for the Dow, S&P 500, and Nasdaq are seeing losses of 0.5%, 0.6%, and 0.8%, respectively. Whereas this was unsupportive for crude, a 0.2% drop in the US dollar index was supportive.
The complex settled mixed, featuring wider refinery crack spreads yesterday. Brent and WTI crude futures both lost 28 cents, closing at $74.49 and $71.20 per barrel, gasoline futures rose by 1.18 cents to settle at $2.3025 per gallon, heating oil settled 95 points higher at $2.2889 per gallon and natural gas futures fell by 16.8 cents to $3.951 per MMBTU.
As of this morning, the latest 6-10 day NOAA forecast calls for near to below-normal temperatures across the eastern half of the country, and the 8-14 day outlook is similar but less supportive.
Monday, March 3, 2025
Refined products are trading mixed on Monday morning with heating oil losing over 1%, while gasoline futures had sky-rocketed to gains of over 13%. Gains in European equites, higher trade in US stock market index futures, and sizeable losses in the US dollar index were likely supporting. Energy traders are looking ahead to the final US S&P Global Manufacturing PMI, the ISM Manufacturing Index and to US construction spending data for further direction.
In economic news from Asia last night, the Chinese Caixin Manufacturing PMI for February came in at 50.8, slightly above the 50.4 expectation. Nevertheless, the Shanghai Composite edged down 0.12% overnight, while Hong Kong’s Hang Seng added 0.28% and the Nikkei in Japan gained 1.70%. In India, the final Markit/Nikkei Composite PMI came in 56.3 last month, short of the 57.1 flash estimate. In European news, the final February S&P Global Composite PMI for France (45.8), Germany (46.5), and the UK (46.9) all saw a surprise upward revisions from the flash estimate. Furthermore, the February final Composite PMI for the Eurozone came in at 47.6, also above the unrevised 47.3 flash estimate. The flash Harmonized Index of Consumer Prices (HICP) for the Eurozone showed consumer prices increased by 2.4% year-on-year in February, above the 2.3% consensus. Narrow core prices rose 2.6% year-on-year last month, matching expectations. As of this writing, the UK FTSE 100 was up 0.62%, the French CAC 40 had gained 0.88%, and the German DAX had risen 1.18% higher. US stock market index futures were seeing gains of between 0.23% (Dow futures) and 0.51% (Nasdaq futures). Also supportive, the US dollar index was down 0.59% this morning.
Crude oil and refined products futures traded flat to lower on Friday amid a stronger US dollar, despite dimmed prospects for a Russia-Ukraine peace agreement, flat to higher trade in equities and the loss of 2 US oil rigs. WTI crude edged down 59 cents to $69.76 a barrel, Brent crude dropped 86 cents lower $73.18 a barrel, gasoline futures fell by 2.63 cents to settle at $1.9703 per gallon, heating oil led the way lower, losing 4.10 cents for a $2.3549 per gallon settlement and natural gas futures fell further of Friday, losing 10 cents to close at $3.834per MMBTU.
As of this morning, the latest 6-10 NOAA forecast calls for mostly well-above-normal temperatures in the Midwest and near to below-normal temperatures in the Northeast. The 8-14 day outlook is far less supportive as well-above-normal temperatures are expected to persist throughout the eastern half of the country.
Monday, December 2, 2024
Energy prices are trading mixed but mostly higher as of this writing on Monday, amid escalated tensions in the Middle East. Attacks continue in defiance of the ceasefire agreement between Israel and Lebanon that took effect last week and expectations that OPEC+ will continue to delay planned output increases after postponing its meeting to December 5th, despite losses in US stock market index futures and a stronger US dollar.
Market participants are looking ahead to the US ISM Manufacturing Index, construction spending data and to the S&P Global Manufacturing PMI for further direction.
The final November Nikkei/S&P Global Manufacturing PMI for India came in at 56.5, a surprise downward revision from the 57.3 flash estimate. The final November Jibun Bank Manufacturing PMI for Japan came in at 49.0, unchanged from October. The Asia Dow closed 0.64% higher, with the Nikkei in Japan adding 0.80%, the Hang Seng rising 0.65%, and the Shanghai Composite jumping 1.13% higher. In European news, French Manufacturing PMI came in at 43.1, seeing a marginal downward revision to the contractionary 43.2 flash estimate. Both the UK and German Manufacturing PMI also missed expectations, coming in at 48.0 and 43.0 respectively, while Eurozone Manufacturing PMI matched the initial print. In the UK, the Nationwide House Price Index for last month showed a 1.2% increase in house prices, well above the 0.2% expectation. Lastly, the Eurozone unemployment rate for October came in at 6.3%, matching expectations and holding steady after no change in September. With mixed economic news out of Europe, the UK FTSE 100 was up 0.13%, the German DAX had added 0.83%, and the French CAC 40 had gained 0.28%. Futures for the major US stock indexes were trading flat to lower with futures for the Dow shedding 0.09%, S&P 500 futures off by 0.17%, and Nasdaq futures having lost 0.18%. Also unsupportive for crude, the US dollar index was up 0.43% this morning.
The complex weakened on Friday as Brent crude fell 34 cents to $72.94 a barrel and WTI crude lost 72 cents to settle at $68.00 a barrel, gasoline futures fell 2.97 cents to hit $1.9437 per gallon, heating oil fell 1.06 cents to settle at $2.1930 per gallon and natural gas futures added 15.9 cents on Friday to settle at $3.368 per MMBTU.
As of this morning, the 1-5 day forecast sees well-below-normal temperatures across the eastern half of the country. The 6-10 day forecast is seeing mixed but mostly above-normal temperatures in both consuming regions.
Crude oil and refined products futures are trading near and on both sides of the unchanged mark as of this writing. Market participants are looking ahead to monthly Canadian GDP figures and to US labor market, personal income, and personal consumption expenditures data (including inflation) for further direction.
Reuters reports that the prime minister of Lebanon has expressed hopes for a ceasefire agreement with Israel to be announced within days. In related news, Axios reports that CIA Director Burns has pushed for a 28-day ceasefire in Gaza, meeting with Qatari and Israeli counterparts on Sunday.
Japanese industrial production growth of 1.4% in September beat the 0.8% forecast. However, a retail sales slump of 2.3% the same month missed forecasts calling for a shallower drop of 1.3%. The Bank of Japan kept the overnight interest rate target at 0.25%, as widely expected. Chinese data were similarly mixed, as the CFLP Manufacturing PMI was a slight beat at 50.1, but the non-manufacturing PMI was a slight miss at 50.2. The Shanghai Composite rose by 0.42%, but the Hang Seng lost 0.31% and the Nikkei fell by 0.50%.
German retail sales figures for September were a positive surprise, as sales jumped 1.2% higher when a 0.5% drop had been predicted. In France, consumer price inflation came in at 1.2% this month, per the preliminary CPI reading, matching expectations. The flash October Eurozone HICP, however, saw a 2.0% year-on-year rise – above the 1.9% forecast, but with September inflation revised down from 1.8% to 1.7%. The Eurozone unemployment was 6.3% in September, below the 6.4% forecast, and the August rate saw a downward revision from 6.4% to 6.3%. European shares continued lower today, however, with the DAX down by 0.5%, the CAC 40 having lost 0.9%, and the FTSE 100 seeing a 0.8% loss as of this writing. Futures for the major US stock market indexes were also trading in the red, with losses of between 0.5% (Dow futures) and 0.9% (Nasdaq futures). The US dollar index was steady.
Brent crude gained $1.43 to close at $72.55 a barrel, WTI crude settled $1.40 higher at $68.61, gasoline futures gained 4.39 cents, settling at $1.995 per gallon, and heating oil jumped to $2.1876 per gallon but natural gas futures slipped 1.4 cents lower to settle at $2.845 per MMBTU.
The 1-5 and 6-10 day GFS temperature forecasts are calling for above-normal temperatures in the Northeastern and Midwestern consuming regions.
Tuesday, October 1, 2024
Crude oil and refined are trading flat to lower as of this writing on Tuesday morning, with flat to lower trade in US equities and strength in the US dollar, despite flat to higher trade in European equities and an Israeli ground incursion into southern Lebanon.
Market traders are looking ahead to the ISM Manufacturing Index for September, construction spending figures for August and the Job Openings and Labor Turnover Survey for the same month, for further direction.
Reuters reports that Israeli paratroop and commando units have launched raids in Lebanon in a “limited” ground incursion. In US news, the International Longshoremen’s Association (ILA) union has gone on strike for the first time since 1977, affecting ports from Texas up to Maine that account for about half of US imports. In other domestic news, the DOE has purchased 6mb of oil for the Strategic Petroleum Reserve (SPR) for delivery through May of next year. The DOE has funding for about 2 million more barrels at $75 a barrel, but will need to ask Congress for additional funding or cancel congressionally mandated sales in order to keep refilling the SPR.
In economic news this morning, the Japanese unemployment rate saw a surprise 0.2 percentage point drop to 2.5% in August. The Tankan Survey for the third quarter was a mixed bag, with stronger than expected large non-manufacturer sentiment but weaker than expected manufacturer sentiment. Large firm capital expenditure plans were weaker than expected, but small firm capex plans matched expectations. The Nikkei rallied 1.93% higher last night, while the Hong Kong and Shanghai stock exchanges were closed for a holiday. The Nikkei/S&P Global Manufacturing PMI for India saw a larger than predicted downward revision from the flat 57.5 print, to 56.5 last month. In European news, the flash HICP showed consumer prices increased by 1.8% last month, below the 2.0% forecast. Narrow Core prices rose by 2.7%, also below the 2.8% forecast. The final September S&P Global French (44.6), German (40.6), and Eurozone (45.0) Manufacturing PMI all saw surprise upward revisions from the flash estimate, as did the CIPS/S&P Global UK PMI, to 51.5. As of this writing, the CAC 40 was steady, the DAX had risen by 0.4%, and the FTSE 100 had gained 0.5%. Nasdaq futures were up by 0.1% but S&P 500 futures were flat and futures for the Dow were off by 0.2%.
Energy prices settled mixed and little changed yesterday, with a stronger dollar and losses in equities, as well as an agreement over Libyan central bank leadership likely weighing on trade, whereas Middle East tensions surrounding Israeli military activity were supportive. Brent crude slipped 21 cents lower to close at $71.77 a barrel, WTI crude closed one cent weaker at $68.17 a barrel, gasoline futures edged up 91 points to settle at $1.9621 per gallon, heating oil settled down 9 points at $2.1318 per gallon and natural gas futures added 2.1 cents to settle at $2.923 per MMBTU.
As of this morning, the NHC is tracking Tropical Storm Kirk (no perceived threat to land) and a disturbance to its east that is given a strong chance (80%) of developing into a tropical cyclone over the next two days.
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.
Wednesday, November 1, 2023
The energy complex is seeing gains of over 1.5% as of this writing despite losses in US stock market index futures and continued strength in the US dollar. Market traders are looking ahead to US manufacturing and construction spending data, the ADP Employment Report, the Job Openings and Labor Turnover Survey and to the weekly petroleum stock report from the Energy Information Administration (EIA) for further direction.
The API reported a 1.30mb build in US crude oil stockpiles for the week, slightly above forecasts at 0.88mb (average of polls by Reuters and the Wall Street Journal). Data for distillates were supportive as the agency reported a larger than expected draw of 2.50mb (vs 1.72mb) and inventory figures were neutral for gasoline as the API reported a draw of 0.36mb, in line with the 0.65mb expectation. An OPIS poll calls for a 0.5mb draw from propane and propylene inventories in today’s EIA report.
The Caixin China Manufacturing PMI fell from 50.6 to 49.5 last month, missing the 50.8 forecast and falling back into contractionary territory. Nevertheless, the Shanghai Composite edged up 0.14% and the Nikkei jumped 2.41% higher, while the Hang Seng fell 0.06%. In India, the S&P Global/Nikkei Manufacturing PMI for last month came in at 55.5, down from 57.5 in September. In European news, the final UK CIPS/S&P Global Manufacturing PMI for last month came in at 44.8, below expectations at 45.2. The UK Nationwide House Price Index for October rose by 0.9%, whereas forecasts called for a 0.4% decline. As of this writing, European stock markets were trading mixed around the unchanged mark.
Petroleum futures closed mixed yesterday with mostly higher trade in global equities likely supporting, while a rally in the US dollar index was an unsupportive factor. Brent crude edged down 4 cents to close at $87.41 a barrel, WTI crude settled $1.29 weaker at $81.02 a barrel. Refined product settled flat to higher as gasoline edged up 27 points to settle at $2.2227 per gallon and heating oil rose 2.47 cents to $2.9910 per gallon. Propane prices increased by 31 points to 65.75c/g (34.2% of crude) and natural gas futures jumped 22.3 cents higher to settle at $3.575 per MMBTU.
The latest 1-5 day forecast based on the European model remains supportive as below-normal temperatures are expected across the eastern half of the country. The 6-10 day outlook remains supportive for the Northeast, but the Midwest is expected to see mostly above-normal temperatures.
Wednesday, September 6, 2023
Energy prices are trading flat to lower Wednesday morning, threatening to end a long gaining streak for WTI amid losses in European shares and in US stock market index futures, despite some weakness in the US dollar index.
Energy traders are looking ahead to the Bank of Canada monetary policy announcement, Canadian merchandise trade data, the US international trade in goods and services figures, and to the final S&P Global Composite PMI for further direction. The weekly EIA inventory report will be released tomorrow, a day later due to the holiday on Monday.
Asian stock markets closed flat to higher last night as the Hang Seng edged down 0.04% while the Shanghai Composite edged up 0.12% and the Nikkei rose 0.62%. In European news, retail sales in the Eurozone fell 0.2% in July, as expected. Manufacturers’ orders in Germany dropped 11.7% lower in July, missing forecasts calling for a smaller dip of 4.0%. On the other hand, the UK Construction PMI for August came in at 50.8, just above the 50.7 consensus, but still down from 51.7 the month prior. As of this writing, the DAX was down 0.5%, the FTSE 100 had lost 0.7%, and the CAC 40 was leading the way down with a 0.8% drop. US stock market index futures were seeing losses of around 0.25% this morning. In the supportive column, the US dollar index was down 0.1%.
Crude futures continued higher yesterday with WTI rising for an eighth consecutive session amid news that both Saudi Arabia and Russia have decided to extend their oil output cuts and reduced exports, respectively, through the end of the year. Brent crude rose $1.04 to $90.04 a barrel, WTI crude added $1.14 to close at $86.69 a barrel, gasoline edged down 1.02 cents to $2.5810 per gallon, heating oil shot up 11.46 cents to settle at $3.2196 per gallon and natural gas price settled at $2.582 per MMBTU.
Tropical Storm Lee has formed in the Central Tropical Atlantic and is expected to become a major hurricane by the end of the week as it moves northwestwards towards waters north of the Leeward Islands. The National Hurricane Center is following two more disturbances, one located in the Eastern Tropical Atlantic and the other in the Northeastern Atlantic, but both are given low chances of cyclone formation over the next 48 hours.
Monday, April 3, 2023
Crude futures are extending their rally for a third session this morning. Gains are accelerating following the announcement of surprise OPEC+ output cuts. Also supportive was weakness in the dollar, strength in Asian equities and flat-to-higher trade in European stocks, whereas US stock market index futures were mixed. Market participants are looking ahead to US manufacturing and construction spending data for further direction.
Reuters reports that OPEC+ announced production cuts of 1.16mb/d, to begin in May and last through the end of the year. Saudi Arabia (500kb/d) and its Gulf allies the UAE (144kb/d), Kuwait (128kb/d), along with Iraq (211kb/d) are to account for the lion’s share of the cuts. Non-OPEC cuts are to come from Kazakhstan (78kb/d) and Oman (40kb/d). According to S&P Global, OPEC parties with output targets produced 866kb/d below target in February and non-OPEC production was 1.05mb/d below target, for combined total underproduction of 1.91mb/d. The 1.16mb/d of cuts, plus the previously announced 500kb/d in Russian cuts that began this month, would cut that gap down to 0.25mb/d.
The Hang Seng edged up 0.04%, the Nikkei gained 0.52%, and the Shanghai Composite strengthened by 0.72% last night. The Nikkei/S&P Global Manufacturing PMI for India rose from 55.3 in February to 56.4 last month, indicating expansion in the sector accelerated. In European news, the final S&P Global Manufacturing PMI for France saw a surprise downward revision to 47.3, but the German index was a surprise upward revision to 44.7, as did the index for the Eurozone as a whole, to 47.3. As of this writing, the German DAX was off 0.2%, but the French CAC 40 had gained 0.3%. The final March UK CIPS/S&P Global Manufacturing PMI saw a slight downward revision to 47.9. Nevertheless, the FTSE 100 was up by 0.6% this morning. In the US, Dow futures were up 0.3% but S&P 500 futures were down 0.1% and Nasdaq futures had lost 0.7%. Meanwhile, a 0.1% dip in the US dollar index was supportive for crude.
The complex strengthened across the board on Friday amid strength in equities, despite strength in the US dollar. Brent crude gained 50 cents, closing at $79.77 a barrel, WTI crude jumped $1.30 higher to settle at $75.67 a barrel, gasoline futures settled 3.91 cents higher at $2.7005 per gallon and heating oil jumped 5.26 cents higher to settle at $2.6763 per gallon.