Written Commentary
CRUDE OIL
With a fresh lower low for the move early today negative supply-side news and demand fears the bear camp remains in control. Signs that state-run Chinese refineries have “shunned” oil trades with the Russians were discounted in the wake of the headline release of oil from the IEA and the US. Not surprisingly, the oil market came under aggressive liquidation yesterday in the face of news that the IEA was joining the US in a massive 120-million-barrel release of strategic oil supply. Another lesser pressure on oil prices came from news that Hungary agreed to buy oil from Russia in Rubles, as that allows some oil from Russia to flow into world supply.
The gasoline market also forged a fresh lower low for the move despite news that Singapore weekly fuel stocks fell 4% over the last week. Like the crude oil market, the gasoline market also fell out of bed yesterday under the weight of inside and outside market forces.
NATURAL GAS
Apparently, very cold temperatures in the West Coast next week gave the natural gas market the impetus to forge fresh contract highs yesterday. However, with a massive spike up move rejected yesterday, the natural gas charts again give off the impression of a blow-off top. On the other hand, natural gas flow through the Yamal pipeline shifted from westerly to the east overnight, thereby adding credence to support on the charts at $6.00.
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.
