Written Commentary
CRUDE OIL
While crude oil prices in the early going today are showing weakness, the API report yesterday afternoon should provide a significant underpin for prices at current levels. In fact, API inventory data for gasoline might be even more supportive of prices than the API crude oil stocks decline. Yesterday the API showed crude oil stocks declined by 2.5 million barrels and that is likely to change the range of estimates for today’s EIA report from a gain of 2.1 million barrels perhaps to unchanged.
Gasoline prices yesterday rose in concert with the gains in crude oil prices but ultimately the gains in crude were not as significant in gasoline.
NATURAL GAS
Clearly, mild temperature forecasts for both Europe and the US and news that Russia would see their gas production this year rise by 12% provides the bear camp with ongoing confidence to attack natural gas. Furthermore, yesterday December prompt gas prices in the UK declined sharply while December UK gas pricing fell by 7.6%.
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