Opening Prices:
> WTI NOV20 futures contract is up 42c to $40.67/Bbl, and Brent is up 40c to $42.32/Bbl.
> Natural gas OCT20 futures contract is down 8.2c to $2.057/MMBtu. The NOV20 futures contract is down $0.066 to $2.741
As I discussed in my podcast, today is the final day for paper traders to close their OCT20 ngas contracts. If you trade futures and you can't take physical delivery you NEVER should wait until the last week to close out your positions. NOV20 will be the "front month" tomorrow, so the for the unaware of how this works it will look like a 70 cent increase in the gas price in one day.
Oil & Gas Prices - Sept 28
Oil & Gas Prices - Sept 28
Last edited by dan_s on Mon Sep 28, 2020 11:20 am, edited 1 time in total.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Sept 28
Oil Price forecast
From a Raymond James report on the refining sector 9-28-2020
"Conclusion: Gauging the impact of a tough stretch for refinery utilization on crude markets. There's no sugar coating it, energy markets still
have a lot of wood to chop before we can return to normal. The gasoline demand improvements seen throughout the summer were encouraging,
but the pace of gains has leveled off and a stronger gasoline picture alone will not be enough to support higher refinery runs. Jet demand,
unsurprisingly, remains the most concerning segment of the market and until international travel can return with any sort of magnitude, the
outlook doesn't look much better than today. While refiners showed success in "un-making" jet fuel since the pandemic hit, this has shifted a lot
of excess supply into the diesel pool. Therefore, with diesel inventories sitting near 5-year highs, we do not see the market able to move refinery
utilization rates much higher until jet demand returns. This not only presents an overhang for refiners (though sentiment may be bad enough to
fully price this in at current levels), but with operators remaining disciplined in managing product inventories, it also presents a headwind for the
crude markets — hence our continued caution on the outlook for crude prices over the next several months."
Refined gasoline inventories are back in the normal range, but there is a "glut" of distillates, primarily diesel and home heating oil, that is going to be very difficult to work off because what was going to jet fuel is now going into distillates. A colder than normal winter would help.
From a Raymond James report on the refining sector 9-28-2020
"Conclusion: Gauging the impact of a tough stretch for refinery utilization on crude markets. There's no sugar coating it, energy markets still
have a lot of wood to chop before we can return to normal. The gasoline demand improvements seen throughout the summer were encouraging,
but the pace of gains has leveled off and a stronger gasoline picture alone will not be enough to support higher refinery runs. Jet demand,
unsurprisingly, remains the most concerning segment of the market and until international travel can return with any sort of magnitude, the
outlook doesn't look much better than today. While refiners showed success in "un-making" jet fuel since the pandemic hit, this has shifted a lot
of excess supply into the diesel pool. Therefore, with diesel inventories sitting near 5-year highs, we do not see the market able to move refinery
utilization rates much higher until jet demand returns. This not only presents an overhang for refiners (though sentiment may be bad enough to
fully price this in at current levels), but with operators remaining disciplined in managing product inventories, it also presents a headwind for the
crude markets — hence our continued caution on the outlook for crude prices over the next several months."
Refined gasoline inventories are back in the normal range, but there is a "glut" of distillates, primarily diesel and home heating oil, that is going to be very difficult to work off because what was going to jet fuel is now going into distillates. A colder than normal winter would help.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Sept 28
Oil price technical analysis: https://www.investing.com/analysis/two- ... -200539129
As I pointed out in the podcast, since we are beyond the summer driving season (high demand for gasoline) and have a 6-8 weeks before demand for home heating oil picks up, WTI is "range bound". My HOPE is that getting past the election at least reduces the COVID-19 gloom & doom hype by the media and an early cold wave gives demand a boost.
As I pointed out in the podcast, since we are beyond the summer driving season (high demand for gasoline) and have a 6-8 weeks before demand for home heating oil picks up, WTI is "range bound". My HOPE is that getting past the election at least reduces the COVID-19 gloom & doom hype by the media and an early cold wave gives demand a boost.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Sept 28
Closing Prices:
> WTI prompt month (NOV 20) was up $0.35 on the day, to settle at $40.60/Bbl.
> NG prompt month (OCT 20) was down $0.038 on the day, to settle at $2.101/MMBtu. < The NOV20 contract was down $0.039 to close at $2.768. NOV20 is now the "front month".
> WTI prompt month (NOV 20) was up $0.35 on the day, to settle at $40.60/Bbl.
> NG prompt month (OCT 20) was down $0.038 on the day, to settle at $2.101/MMBtu. < The NOV20 contract was down $0.039 to close at $2.768. NOV20 is now the "front month".
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group