Written Commentary
CRUDE OIL
The bias has shifted down in the energy complex despite today’s global risk on sentiment, further signs that Chinese energy demand will remain strong and despite the threat against supply from Norway due to a strike threat. However, the bear camp has significant ammunition following news that Saudi Arabia and Russia failed to come to an agreement on the extension of production restraint with the added kicker coming from indications that the Russian leader has no interest in speaking with the Saudis before the next meeting.
NATURAL GAS
With natural gas continuing to show respect for the $2.80 level with action over the last 2 weeks, reports that demand for floating supply jumped 19% in the last 20-days and the EIA pegging US lower 48 gas production to have declined by 0.9% in September relative to August, the market appears to have both technical and fundamental reasoning to suspect a low has been forged.
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