Written Commentary
CRUDE OIL
In retrospect, the energy market gains last week were impressive in the face of news that OPEC+ would be increasing production by 500,000 barrels per day starting in January and in the face of a much weaker than expected US nonfarm payroll reading. However, the crude oil market this morning appears to have reversed course despite news that Chinese November crude oil imports came in at 11 million barrels per day versus 10 million barrels per day in October.
NATURAL GAS
Certainly, natural gas prices are entering extremely cheap price levels and the markets are entering into the North American heating season and that could cushion prices. However, US supplies continue to weigh on prices and demand for gas from North American heating has been anemic early on. In fact, last week’s US storage fell by only 1 BCF and that clearly suggests demand is running below normal.
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