Written Commentary
CRUDE OIL
Not surprisingly, the crude oil market extended the November rally in what is very likely a further extraction of shorts that were expecting further demand destruction from infections. In fact, we suspect that fresh buying by funds anticipating progressive recovery in global energy demand on are now adding to the upward slope in prices. Certainly, the largest TSA security check readings since the beginning of the US lockdown in March last weekend could be a temporary result of the coming US holiday, seeing those numbers might inspire others to travel.
NATURAL GAS
While we think the prior 2 days of upside action has been largely the result of technical short covering more limited gains are possible. On the other hand, despite natural gas showing little reaction to improved macroeconomic conditions over the past several months, that theme should now begin to lift prices. Unfortunately for the bull camp, the National Weather Service temperature forecast is not overly supportive, with US cooling gas demand areas seeing below normal temperatures and US heating gas demand areas seeing temperatures above normal.
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