Explore Special Offers & White Papers from ADMIS

Energies Overview for May 28

We suspect that crude oil prices are being held back this morning by fears that the Chinese recovery could be slowed in the event of sanctions levied by the US because of heavy handedness in Hong Kong. It is also possible that prices are somewhat undermined this morning as a result of chatter that price gains have begun to foster talk of Russia rolling back production cuts. Seeing the Russians potentially scroll back output restraint must be offset in kind by steady improvement in energy demand expectations from restart activity or prices will likely stall below the $35 level.

The natural gas market has benefited from a warm/hot shift in the US weather forecasts but prices have now returned to the vicinity of chart resistance around $2.00 and buyers could become anxious. However we suspect that natural gas was definitively oversold into last week’s lows (the specs continue to hold net short positioning), and therefore it is possible that a large portion of this week’s recovery has been classic short covering buying and not fresh fundamental buying. However restart activity should begin to lift electric generation demand ahead and give the bull camp some fundamental assistance.

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.

Latest News & Market Commentary

Explore Special Offers & White Papers from ADMIS

Get Started