Comments below from CME Group analyst:
The crude oil complex traded higher throughout the Wednesday morning hours, helped by ideas that recent weakness might have been overdone, improving European economic data and large product inventory draws. December Crude Oil prices trended higher into the mid-session and posted a new three day high in the process.
> This morning's EIA inventory data showed a slightly smaller than expected build in US supplies last week of 1.577 million barrels. > The refinery operating rate was down 0.5% to 86.8%.
> One of the surprise features in this morning's EIA report was the much larger than expected decline in gasoline stocks of 3.755 million barrels. Traders were also encouraged by a solid jump in demand, with total gasoline demand for the past four weeks up 5.38% compared to last year.
> EIA distillate stocks fell 4.899 million barrels, which was also quite a bit larger than expected.
December Natural Gas Prices were also higher during the session and rallied back above the $3.50 level. While near term demand prospects remained under pressure from warmer than normal weather forecasts, a measure of bargain hunting interest after recent declines seemed to be the prevailing factor.
Oil & Gas Prices
Oil & Gas Prices
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices
Early this week, WTI plunged through $95/bbl, which looked like a major support level to me. If the price can close above $95 on Friday, I would consider that very bullish. At least for the 4th quarter.
The next strong support level looks like $88/bbl to me. Let's hope we don't test it.
Natural gas flopping around $3.50 is the best we can hope for until some real winter weather move it. I just ran through ten days of weather maps and we are starting to see some below freezing nights in the upper Midwest. Remember that the five states that consume the most gas for space heating are ILL, WI, MICH, Ohio and Texas. The reason Texas consumes so much Ngas is because EVERYONE heats with gas and we have big pouring insulated homes.
I am using $90/bbl WTI and $3.50/mcf natural gas in all of my forecast models and valuations for 2014.
The next strong support level looks like $88/bbl to me. Let's hope we don't test it.
Natural gas flopping around $3.50 is the best we can hope for until some real winter weather move it. I just ran through ten days of weather maps and we are starting to see some below freezing nights in the upper Midwest. Remember that the five states that consume the most gas for space heating are ILL, WI, MICH, Ohio and Texas. The reason Texas consumes so much Ngas is because EVERYONE heats with gas and we have big pouring insulated homes.
I am using $90/bbl WTI and $3.50/mcf natural gas in all of my forecast models and valuations for 2014.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group