Written Commentary
CRUDE OIL
October Crude Oil was higher early Monday but inside last week’s range, as there has been no change to the standoff between the US and Iran and no suggestion that there are any negotiations occurring. Shipping through the Strait of Hormuz slowed over the weekend, with five commodity vessels reported transiting the strait on Saturday and none registered for Sunday, according to ship-tracking data from Kpler and down from 31 the previous weekend and 130-140 per day before the war. The Baker Hughes rig count showed US oil rigs in operation were up 1 rig to 455 last week. This was up from 411 rigs a year ago and below the five-year average of 484. The total oil and gas rig count rose by five to 593, the highest since March 2025. China’s is estimated to have grown their crude supply by 210,000 barrels per day (bpd) in July after seeing net draws of 940,000 bpd in June and 500,000 bpd in May.
PRODUCTS
October ULSD traded to another new contract high early Monday
NATURAL GAS
October Natural Gas gapped lower early Monday and was back threatening the lows for five year low from August 7, which is a four-month low on the nearby chart. US production is running at a record pace, and supplies are ample despite a generally above-normal temperature trend this summer. The market may also be reeling from last week’s EIA storage report for the week ending August 7 that showed storage was +36 bcf from the previous week versus an average trade expectation of +32. The Baker Hughes rig count showed US natural gas rigs in operation were up 4 rigs to 128 last week. This was up from 123 rigs a year ago and above the five-year average of 121.
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