Written Commentary
CRUDE OIL
Despite overnight claims that it could take weeks to restore idled energy industry facilities in the Gulf area, crude oil prices this morning have not seen noted buying interest. However, Offshore, and onshore production disruptions are being seen, crude oil storage in the ARA declined by 1.2% on the week and those inventories declined in August by the largest rate since at least 2013.
Apparently the trade remains largely unconcerned about the duration of lost US refinery capacity with the October gasoline contract remaining well below the Monday spike high. Therefore, the bull camp in RBOB should be disappointed, and the bear camp should be emboldened by this week’s developments. Furthermore, the key US gasoline transportation pipeline (Colonial) has reopened, and the trade has quantified timing for the return of most refinery activity.
NATURAL GAS
With the October natural gas contract extending its respect of the $4.20 level for a third straight session yesterday and prices strengthening notably this morning, $4.20 appears to be a very strong fundamental and technical pivot point support level. The bull camp is emboldened by a shift in the US temperature forecast to include a wider area of above normal temperatures in the Western half of the country out through September 14th.
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.
