Crude/Nat Gas Morning Outlook 2/3/25

Good Morning...Early Nymex Crude is trading 1.20-1.80 higher...The US Dollar Index is higher (109.15) and the Dow Jones future are 550-600 pts lower. Crude futures rallying in the early trade as the Trump Administrations tariffs include crude oil, with a 25% tariff on Mexican energy imports and 10% on Canadian. This should cause both countries to seek other alternatives to export which should cause some painful logistic and costly efforts. While the US will rely more on OPEC countries for supply replacement (OPEC meets?this week and expectations are for no change in current production). Given the slowing in Canadian crude imports into the US, we should see?a higher disparity in Midwest fuel prices as refiners search for alternatives. Again, this is probably more bark than bite for future negotiations, but near-term supplies will tighten. The real negative to the US oil industry will be if China's economy is harmed further by tariffs which could be a longer negative to US crude demand. Technically March WTI futures moved back above trendline resistance in the early trade with major resistance at the 75.21 area. Major support remains at the 200-day mov avg (72.08)

Early Nat Gas is Trading 15-25 cents higher.... Longer term weather forecast turning colder than expected for most of the central US which could add to the record withdrawal from US storage seen the last 3 weeks. Also fears that Canadian Nat Gas supplied to the US may lessen in some areas (over 9% of Nat Gas that is used in the US comes from Canadian supplies). So far in February LNG exports are running at record levels as well (15.3 BCF/day). Technically March NG has "gapped" higher this morning testing trend line resistance at the 3.356 area. Major support will be the 3.118-3.07 area. Caution is warranted as futures normally try to "back and fill" into the chart gap area before moving higher.?

Dennis Kissler

SVP/Trading Division

Commodity Risk Mgmt

BOK Financial (OK,TX,CO,AZ,NM,MO,AR)

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