Written Commentary
CRUDE OIL
The energy markets appear to have run out of upside momentum as they are under pressure coming into this morning’s action. There are reports that the Saudi and Russian Energy Ministers will meet for informal talks with OPEC Plus officials on Saturday. That may have rattled the market as it has priced-in an extension of output quotas for at least 3 more months at next week’s meeting, These informal talks could indicate that the efforts to reduce those production cuts by several OPEC Plus members may be gaining some traction.
NATURAL GAS
After a sharp 4-session rally, natural gas prices have fallen back from Wednesday’s 2-week highs coming into this morning’s action. US LNG exports have reached record high levels which have provided strong underlying support to the market and encouraged pre-holiday short-covering. Asian LNG prices continue to rise, which provides even more incentive for US exports that should underpin natural gas prices.
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