Energy Markets Lower Outlook
CRUDE OIL MARKET FUNDAMENTALS
With a slight tempering of global economic sentiment overnight and definitively negative news from the API yesterday afternoon a setback in prices early today is justified. In fact the API crude inventory inflow was significantly larger than expectations even though the key Cushing Oklahoma delivery hub saw a decline.
We continue to leave the edge with the bear camp with a large US natural gas giant (Chesapeake Energy) thought to be poised to declare bankruptcy, which in turn highlights the prevailing very negative attitude toward the natural gas market. In fact, the negative demand views held by the market for 10 months were reiterated by news that US power use is expected to decline by a record amount this year due to the coronavirus.
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