Crude/Nat Gas Morning Outlook 8/1/24
BOK Financial - Energy Financial Services
Experienced bankers, engineers, derivative consultants & analysts provide a financial resource for the energy industry.
Good Morning…Early Nymex crude is trading steady/higher…The US Dollar Index is higher (104.33) and the Dow Jones Futures are 20-80 pts higher. Crude continuing its latest uptrend on news that Iran is meeting with regional representatives to discuss a retaliation strike against Israel. A large move in open interest of option call buying has been noted in the last two trading sessions which has also been supportive to prices. The EIA did report crude inventories dropped again (down 3.4 mil bbls, it was however less than the API reported a day earlier). Still, while the Middle East conflicts are concerning, no real crude supplies have been taken off the global market, and until we see a disruption in real supply, the market will begin to get tolerant to the attacks. Asian crude imports have also been sinking to the lowest levels in over two years, confirming the slowing Chinese economy is another demand concern for crude. Technically Sept WTI crude has moved to a neutral trend and continues to challenge the 50-day mov avg (78.58). A close above turns the near-term trend to bullish and targets the 80.88 area. Major support rests at the 200-day mov avg (76.72).
Early Nat Gas is Trading steady to 6 cents higher…Longer term weather forecasts are turning cooler in the northeast which is a negative. LNG exports are back to near capacity which is a positive, and demand for the remainder of the week for power should set a record in many areas. Hotter temps in Europe have also been a positive with prices rising nearly 15% so far this week. While the Tropical storm disturbance in the Atlantic is moving more Gulf bound at this time, its risk to production areas is very low. The EIA storage number this morning is looking for a 29-35 BCF injection, last year this week it was a 14 BCF injection with the five year average at a 33 BCF injection. Technically Sept NG remains in a bearish structure with major support being the possible major key reversal low at the 1.991 area.
Dennis Kissler
SVP/Trading Division
Commodity Risk Mgmt
BOK Financial (OK,TX,CO,AZ,NM,MO,AR)
Trade Desk 405.272.2026 Cell 405.203.8618
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