Written Commentary
CRUDE OIL
December crude oil prices morning remain within striking distance of contract highs in the early going. The market should be supported because of talk that some OPEC+ members will not support calls for increased production. Some OPEC+ members they don’t have the capacity to raise production (particularly African producers) and therefore they will not support higher supply flow.
With a fresh 4-day high in RBOB this morning the charts remain bullish with tight supply, surging retail demand in the US and favorable charts providing the bull camp with ammunition. However, the gasoline market has started the new week extending last week’s recovery bounce. Strength is likely the result of reports of developing fuel tightness in China and India.
NATURAL GAS
The natural gas market extended sharply on the downside yesterday in a move that looks to extend in the days ahead. Like the petroleum complex, we are skeptical of the bull case in the natural gas market as expectations of a cold winter probably got ahead of reality.
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