Written Commentary
CRUDE OIL
We continue to see the crude oil market vulnerable to further downside action ahead. First and foremost, among the bearish fundamental arguments are suggestions from the Iranian chief negotiator at the nuclear talks suggesting he expects to see “swift sanctions relief”. The Iranian situation could
be a major impact on the effort to balance the world oil market as analyst think a reduction in sanctions would result in Iran boosting its output by a very
significant 2 million barrels per day.
Like the crude oil market, we see the gasoline market vulnerable to a return to consolidation support left from the 2nd half of March.
NATURAL GAS
As we suggested yesterday, despite bearish conditions it is difficult to recommend short positions in natural gas given the proximity to historically low pricing of $2.50. However, fundamentals remain negative from both supply and demand perspectives. In fact, we see the US temperature forecast out to April 21st as patently bearish, as below normal temperatures in the Gulf states will reduce cooling demand, while above normal temperatures in the Pacific Northwest will reduce heating demand.
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.
