Written Commentary
CRUDE OIL
June Crude Oil was sharply lower early Wednesday on the news that the US and Iran had agreed to a two-week ceasefire. Pakistani Prime Minister Shehbaz Sharif said he had invited Iranian and US delegations to meet in Islamabad on Friday. The deal is subject to Iran’s agreement to pause its blockade of oil and gas passing through the strait, Trump said. Iran’s foreign minister said in a statement Tehran would cease counter-attacks and provide safe passage through the waterway, if attacks against it stop. There are a lot of issues to be resolved, and even if they are, it will take some time for the movement of ships through Strait, but this is the most bearish news for the market in weeks.
PRODUCTS
Product prices sold off sharply early Wednesday on the news of a two-week cease-fire with Iran on the condition that Iran reopens the Strait of Hormuz. The API numbers were mixed, but the market is looking beyond them because of the Iran news.
NATURAL GAS
May Natural Gas was lower early Wednesday on the news of the ceasefire between the US and Iran, but the selloff was not nearly as dramatic as it was for the crude oil complex because prices were already low. For this week’s EIA gas storage report, the early Reuters poll has a range of expectations for a net injection of 43 to 55 billion cubic feet for the week ending April 3.
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