Strong Support Coming into EIA Report
The energy markets built on early support and are posting moderate gains this morning. The UAE Energy Minister said that OPEC Plus has the capacity to increase production to cool oil prices but does not want to “overdo it.” The International Energy Agency (IEA) said that a global energy crunch could boost crude oil demand by 500,000 barrels per day (bpd).
RBOB and ULSD have maintained upside momentum coming into today’s action, with both markets reaching new multi-year highs. These markets outperformed crude oil Wednesday, perhaps because reports of a jump in Indian fuel consumption and expectations that the recovery in US crude oil production has yet to filter all the way through to repair tight product stocks.
Natural gas prices continued to follow-through on Tuesday’s positive reversal with moderate gains overnight. The EIA commented that US consumers can expect a 30% increase in natural gas expenditures form last winter, and that has provided an early source of support.
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