Written Commentary
CRUDE OIL
While September crude oil initially rejected the overnight downside extension/6-day low, the charts and the fundamentals continue to favor the bear camp. In fact, overnight reports that Asian purchases of cargoes this month have slowed, combined with negative news from OPEC plus this week and what appears to be an overall global sentiment deterioration from surging Delta variant infections, provides the bear camp with a lot of confidence.
While the gasoline market held up relatively better than the crude oil market to the current corrective pressure on all energy prices, we see the path of least resistance pointing downward.
NATURAL GAS
In retrospect, reports that Chinese buyers were planning to scale back natural gas imports until prices fall to cheaper levels, and a weekly injection near the upper in the range of expectations justifies the return below the $3.60 level on the charts. The weekly natural gas storage report showed an injection of 55 bcf. Total storage stands at 2,629 bcf or 6.7% below the 5-year average.
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