Written Commentary
CRUDE OIL
March Crude Oil was lower early Thursday on news that the US/Iran talks were back on schedule for this weekend. The market rallied on Wednesday off concerns they would not be hold. The US agreed to shift the venue to Oman from Turkey, but the two sides are still at odds over what will be discussed. Iran wants only bilateral talks centered on their nuclear program, while the US would like to include multilateral discussions on Iran’s missile program, human rights violations, and their support for proxy groups. The US buildup of military forces in the region, as well as some threatening comments by President Trump, have put the oil market on edge.
PRODUCTS
Like Crude Oil, product prices were lower early Thursday on news that US/Iran talks were back on schedule for this weekend after a hiccup yesterday. However, March Gasoline was holding near the upper end of Wednesday’s range and within the vicinity of that day’s six month high. Action in March ULSD was less impressive, but it is coming off a one-year high from last Friday. The EIA report on Wednesday was bullish for diesel with the diesel stocks falling more than expected, but that was apparently priced into the market lasty week as the extreme cold inspired buying on ideas it would lead to higher demand.
NATURAL GAS
March Natural Gas was higher early Thursday as the market attempted to regain part of the steep selloff from Friday’s high. The weather ahead looks mild and does not suggest US supply will be under much threat. The 6-10 and 8-14 day forecast show above normal temperatures are likely to extend across most of the lower 48 states. Some below normal temperatures may stick around a bit longer in southern New England and some may emerge along the west Coast, but the areas affected are limited, and the deviations from the norm are not extreme.
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