Sagging Energy Demand
Bullish buzz has been drained from crude oil with signs of increased Libyan output (expected to jump to 310,000 barrels per day from just 90,000 barrels per day), renewed global demand fear from lockdown fears, less tropical storm fear (tropical storm beta lacks strength and is already beyond the brunt of offshore production), a stronger dollar and from news that Indian August crude oil imports were down 23% compared to year ago levels.
We are surprised that natural gas prices are holding within proximity to last Friday’s recovery bounce close with big picture risk off conditions in place early today. However, word that cancellations of US export supply has declined for November, a slight increase in Indian and Japanese demand and spot price gains in both Europe and Asia provide support to prices. Thickening resistance above the market is seen from the return of shuttered US production from recent storms and from strength in the US dollar. On the other hand, the US temperature forecast has shifted slightly more supportive with hot temperatures stoking air conditioning demand in California, Nevada and Oregon.
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.