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Ongoing Gains in Energies

CRUDE OIL

With a higher high for the move early today, the crude oil market is discounting Chinese strategic oil sales, the opening of a new Iranian export facility beyond the volatile Straights-of-Hormuz, a surging US infection rate and the first build in US crude oil inventories in many weeks.

Like the crude oil market, the added supply flow of gasoline has not resulted in a repair of a large annual inventory deficit. In fact, US gasoline imports last week where the highest since May 2011, the US refinery operating rate remains at a very high level and yet the gasoline inventory reading remains at a significant deficit of 10.3 million barrels.

NATURAL GAS

With another new high for the move and the highest trade since January 2015 yesterday, the natural gas market appears to have undertaken a paradigm shift with some Press stories overnight predicting $4.00 pricing soon. In fact, the much above normal temperature sweep in the US is expected to extend into August 4th with the hot temperatures now in place for several weeks.

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