Crude/Nat Gas Morning Outlook 4/17/24

Good Morning…Early Nymex Crude is Trading 1.00-1.20 lower…The US Dollar Index is steady/higher (106.25 still near 6-month highs) and the Dow Jones Futures are steady/higher. Crude futures continue to unwind some of the Geopolitical premium that has been priced in. Front month WTI futures spreads (May/June) have moved back below a 60-cent premium to the front month which normally shows building supplies or lessening of demand. The API released its storage data yesterday which showed 4.09 mil bbl build which was well above expectations. Countering the negative crude storage?was a large drop in gasoline storage (dn 2.5 mil bbls). The stronger US Dollar has also hurt US crude exports which is partially the reason of the larger storage build. Still, with the Geopolitical noise being turned down, and expectations of the Israeli?attack to be more strategic than devastation, prices are trying to find equilibrium. Technically May WTI crude remains in a bullish structure with major support at the 84.05 area, a close below targets the 81.63 area. Resistance will be at the possible “double top” near the 87.63 area. All eyes will be on the more reliable EIA storage data this morning.

Early Nat Gas is Trading 2-4 cents lower…The late day rally yesterday from a fire at a pipeline in Alberta Canada (temporarily slowing supplies) has been quickly reversed this morning as futures remain focused on heavy US storage along with European storage well above normal for this time of year. On the positive side if we see daily NG production remain below 98 Bil cu ft/day,?I don’t see prices remaining below $1.70 for very long. Of course, weather and demand will need to show, and June-Aug months seem a along way?away when storage is elevated over 38% above the five year average. Technically the bearish trend continues with support for May NG futures at the contract low (1.649), a close below targets the 1.54 area, then 1.34. Major resistance sets at the 1.873 area.

Dennis Kissler

SVP/Trading Division

Commodity Risk Mgmt

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

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