Potential Strike in Norway
The crude oil market generally coiled within a range last week, but technical traders will suggest the coiling pattern still had a very modest upward tilt, which in turn extended the recovery from the September 20th low. In fact given a risk-on condition this morning, word that floating storage is now 33% below the June highs and signs of a reversal down in the Dollar the bull camp looks to have some protection against bearish news.
We view the natural gas market as too expensive given classic supply and demand fundamentals. Certainly, the bull camp took control last week off what appeared to be a sudden shift in long-term demand prospects following very cold winter forecasts and a sharp upward adjustment in Chinese LNG import readings (Chinese also indicated they would add significant LNG storage). However, the potential to see a strike in Norway could idle as much as 990,000 barrels oil equivalent (meaning combined oil and gas production) and that lends some support to prices.
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.