Market Update
Energies are higher as news of Saudi requests for refined and products and even some crude oil from Iraq injects some doubt as to the Saudis' ability to restore production quickly.
The Saudis have supposedly asked Iraq for 20 mln bbls of crude -while also seeking supplies of gasoline, diesel and fuel oil for domestic use in an effort to save crude oil for export. One analyst was quoted by WSJ as saying that the recent attack could see the Saudis reduce refining capacity usage by 1,4 mln bpd.
Reuters analysis states the Saudis have 18 days of forward cover of crude supply --down from a peak of 33 days cover seen in October, 2015.
The head of Saudi Aramco says that they are processing 2 mln bpd of crude at the facility hit by the attack -down from 4,9 mln bpd processed prior to the attack. (Platts) The Saudi news is overshadowing some bearish items we have seen the past 24 hrs ---today the OECD lowered their 2019 and 2020 global GDP growth forecasts to the lowest level in over a decade. They lowered their 2019 forecast by 0,3% to 2,9% and dropped 2020 estimate by 0,4% to 3,0 % --they cite trade uncertainty as the key issue. (Market watch)
Yesterday's DOE stats were somewhat disappointing as crude supplies rose by 1,058 mln bbls--projections were for a decline of 2,0 mln or more --refinery runs were cut by a large amount , down 3,9% / -788,000 bpd of crude inputs. Estimates were calling for a drop of 0,5% --net crude imports into the US rose by 445,000 bpd --gasoline stockpiles rose by 0,781 mln bbls, while a drop of near 1 mln was foreseen / gasoline demand fell by 868,000 bpd to 8,939 mln bpd. On the bright side --total product exports from the US rose by 924,000 bpd due to better exports of distillate, residual fuel and propane. Technically the energies are trying to turn to positive momentum and the ability to stay above 5820 area for Nov WTI crude oil is mildly supportive to us --the energies have seemingly carved out some support via the lows we see from the past 4 sessions.
For today Nov WTI has support at 5819-27 then 5758--resistance lies at 5998-6000 --then 6077
Brent spot futures support lies at 6403-08 then 6346-55 ( the former is the overnight low) -resistance comes in at 6608-11 then 6682-85
Oct RB futures support is seen at 16785-16800 then 16512-16-with resistance at 17338-39 then 17456-65
ULSD support in October lies at 19860 (light) then at 19680-19700 ---with resistance at 20272-80 ( just above the 20267 high seen so far) -with next resistance above that coming in at 20460-80
NG is down 3 cts as the market expects a near average build for the EIA stats out today.
WSJ forecast survey is calling for +78 bcf / ICE swap mkt seen late yesterday was +78/+84 --these compare to last year's +84 and the
5 yr avge +82 BCF ----Energy Aspects analysts are calling for "stout" injections to come -they see end season inventories at 3,76 TCF (Marketwatch) ---the EIA in its monthly report forecasted 3,769 end of season.
Technically the NG market is showing us a neutral stance at current basis price action although momentum is trying to turn down on the spot DC chart basis.
Spot futures support is seen at 2600-03 then at 2561-2564--with resistance lying at 2660-2670 then at 2696-2700.
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