Energy Market Update 7-14-203

Crude?is?down?4?cents?????RB?is?down?23?points????ULSD?is?up?1?cent

Overview

At this writing, crude oil and RB are lower in what may be a technical correction to an overbought condition. The news the past 24 hours has been supportive with lost crude production and a weaker U.S. dollar.

The dollar today slid against the Euro to a fresh low since late February 2022.

Yesterday, news came out that Libya, due to protests, had shut 2 oil fields that produce 370 MBPD . The fields at Sharara and El Feel have been closed due to protests over the abduction of a former finance minister. (Reuters/Bloomberg)

Shell closed its Forcados export terminal in Nigeria due to a leak. The terminal was set to export an average 220 MBPD of crude in July, as per Reuters.

India saw the total number of airline passengers in June rise by 19% from May. (Quantum)

Technicals

Crude oil momentum via the stochastic indicator looks poised to turn negative from near overbought condition.

WTI for August has a double top from yesterday/today at 77.30-77.33. Resistance basis the DC chart lies above that at 77.97-78.06. Support below lies at 76.11-76.15 then at 74.90-74.99. The 200 day moving average on the DC chart intersects at 77.34. This average has not been tested since late August of 2022.

RB spot futures see support at?2.6433-2.6456. Resistance lies at the 2.70 area.

August ULSD sees support at 2.5760-2.5787. Resistance lies at the 2.65 area. Here too there is a double top from yesterday/today. That lies at 2.6332/2.6349.

Natural?Gas-NG?is?up?4.6?cents

NG is up as ERCOT is set to see a 3rd consecutive day of record power usage in Texas. Demand for natural gas is expected to be strong over the next couple of weeks amid mixed weather trends. "The weather data is still considered to the bullish," NatGasWeather.com says in a report. "Weather patterns across the US the next 15-days are still rather hot and bullish," the report says

Also, TTF prices in Europe have stabilized as heat engulfs the southern portion of Europe, raising cooling needs. The hotter weather has also caused the French to halve the output of 2 nuclear plants from July 13 to 16 due to environmental regulations on using river water for reactor cooling. Nuclear power generation in France constitutes about 70% of the country's electricity mix, making France a net exporter of electricity to other European countries when its reactors are fully operational. (OilPrice.com/Bloomberg)

The EIA data seen yesterday showed a build of 49 BCF, which was a few BCF less than expected. Total storage though remains high relative to last year and the 5 year average, which was supposedly the catalyst for the sell off in futures prices after the data release. Total storage is seen at 2.930 TCF, which is +569 BCF (+24.1%) versus last year's level and +364 BCF (+14.2%) versus the 5 year average. It is +282 BCF or +11.4% versus the 10 year average, as per Reuters.

Technically NG still has negative momentum on the DC chart. But. some support has formed in the 2.536-2.541 area from recent lows. Below that support is seen at 2.463-2.470. Resistance above lies at 2.685-2.692.

Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

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