Written Commentary
CRUDE OIL
Reuters reports that an estimated 2 million barrels per day or roughly 15% of nation crude oil output was lost from the storms over the weekend. Several refineries along the Gulf Coast reported issues as well. Chevron reported hatches were frozen open during the storm on Sunday in Midland, Texas. Exxon Mobil shut units at its Baytown, Texas, petrochemical complex on the east side of Houston. The interruptions are expected to show up in the weekly storage reports in upcoming weeks. Some 810,000 customers across the US remained without power on Monday, down from more than a million estimated over the weekend, which means lower consumption as well.
PRODUCTS
Diesel demand is supported by the cold weather, and interruptions in refining activity could tighten product supplies overall.
NATURAL GAS
March Natural Gas was lower early Tuesday after reaching its highest level since December 8 on Monday. The nearby contract reached its highest level since November 2022 on Monday. Indications are that the winter storm the moved across the US over the weekend and the extreme cold after that has severely affected US gas production. LSEG said average gas output in the Lower 48 states dropped to 106.9 billion cubic feet per day (bcfd) so far in January, down from a record 109.7 bcfd in December. They also reported that output fell to a two-year low of 92.6 bcfd on Sunday, due mostly to freezing wells in Texas and Louisiana.
Interested in more futures markets? Explore our Market Dashboards here.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
