Written Commentary
CRUDE OIL
With a 4-day low in December crude oil in the early going today, the bullish buzz present in the marketplace from August through late October is absent. Obviously, the market saw the EIA inventory report yesterday as bearish to crude oil as the large gains posted early in the Wednesday session were surrendered quickly and the December contract failed at key support.
The gasoline market forged a very wide trading range and ultimately failed making a bearish reversal on the charts yesterday and the market has added to that damage this morning. In supportive overnight developments, Singapore weekly fuel stocks declined by 3.7%, China has cut small refinery fuel export quotas (perhaps to secure domestic supply at lower prices), and WTI spreads are slightly positive.
NATURAL GAS
We do not see the bull market in natural gas at an end. However, ongoing weekly injections combined with mild US and European weather gives the bear camp free run in the short term. On the other hand, the pipeline gas flows from Russia are reportedly very small/slow to eastern Europe, and Belarus is threatening to withhold gas transfer because of EU sanctions.
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