Written Commentary
CRUDE OIL
Not surprisingly, the news flow overnight is contradictory for the energy markets. The potential for Russian/Ukrainian talks is partially countervailed by calls for a “pause” in the Iranian nuclear talks. For now, the energy markets are unsure of the prospect of an increase in OPEC plus supply following contradictory comments from the United Arab Emirates.
In a change of pace, the diesel market showed the weakest product action in the Thursday US trade and that is likely the result of the markets relative overbought status from the March rally of $1.74! On the other hand, the gasoline market spent most of the Thursday trade in the lower portion of the Wednesday trade in a fashion that suggests prices above $3.50 are considered expensive in the current environment.
NATURAL GAS
May natural gas appears to have found support at the $4.50 level. However, there are reports that China (Sinopec) has offered LNG cargos to Europe, the Russian national gas company did book space for Thursday and Friday on the Yamal pipeline, and gas flowing to US export terminals has increased.
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