Written Commentary
CRUDE OIL
While UK officials will rightly claim that there is enough fuel supply in the country, distribution problems have created hoarding and panic buying in a development that provides positive hype for all energy prices. Adding into the global supply shortage argument are signs that China is having difficulty providing electricity for its economy, with the government idling certain industrial activities and aggressively seeking coal to make up for shortages.
In addition to the severe shortages in the UK, worldwide maneuvering in the product markets is also resulting in “supply tightness hype” and that in turn is pulling in aggressive speculative buying for RBOB and ULSD.
NATURAL GAS
With another massive range up extension this morning, the natural gas market is surging toward the highest levels since February of 2014. Clearly, extremely tight European winter gas supply expectations has been joined by reports of increased Chinese LNG buying due to surging domestic coal prices and a lack of coal and gas supply.
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.
