Written Commentary
CRUDE OIL
So much for the recent deterioration in bullish fundamentals, as crude oil this morning has broken out to the highest level since June 23rd. However the boost in energy demand hopes from favorable vaccine news overnight was given added credence by a large 8.3 million barrel decline in API crude oil stocks. It is somewhat surprising that the latest tit for tat trade action in the US/China saga has not limited energy prices this morning especially with an OPEC plus committee meeting underway. The trade has generally expected some mention of a schedule for gradually unwinding the production restraint on Saudi Arabia and Russia but at the same time the cartel is expected to keep pressure on those who have not lived up to their promises.
NATURAL GAS
The charts in natural gas continue to favor the bear camp with a 5th straight day of lower lows yesterday. While US temperatures are still showing significant areas with above normal temperatures, the much above normal temperature area has moderated with some temporary relief seen this week before further heat returns. Apparently the natural gas market does not see record Chinese crude and copper imports as a potential sign of increased Chinese LNG imports ahead perhaps because China and other sources think it is nearly impossible for China to meet its phase 1 purchasing promises and the natural gas market was widely hopeful that phase 1 buying would stir demand for US supply.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
