DMU: November 7, 2023
Analysis of the latest trends in oil and natural gas markets, including OPEC+ decisions, macroeconomic factors, geopolitical influences, and EIA inventory data.
On Today’s Daily Market Update:
Tuesday witnessed a sharp decline in crude and product markets, with Dec diesel and RBOB leading the fall. Dec WTI closed below $80 for the first time since late August, indicating a bearish trend. The entire WTI curve flattened, with Cal 24, 25, and 26 all recording significant losses.
Absence of DOE data due to a reporting hiatus left the market searching for direction, with recent CFTC data suggesting a build-up of short positions. Concerns about faltering Chinese demand and potential European recession contributed to the downturn. The refinery turnaround season's impact on product markets is becoming increasingly relevant.
In the natural gas market, warm weather forecasts pressured the NYMEX curve, with the Dec contract falling to $3.14. The lack of winter premium in the curve and recent weather changes highlight the overpowering influence of climatic conditions over market fundamentals. Speculative positions in natural gas also shifted, reflecting the market's sensitivity to changing weather patterns.
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