Petroleum futures were strengthening further in the overnight session on Wednesday amid bullish US crude oil inventory data from the American Petroleum Institute (API), gains in US stock market index futures, and continued weakness in the US dollar. It was a quiet morning on the economic calendar. Market participants looked ahead to US data in the form of international trade in goods data, the Chicago PMI, and the NAR Pending Home Sales Index for further direction, as well as the weekly EIA petroleum inventory report.
The API reported a 4.80mb draw from US crude oil stockpiles for the week ended December 25, above expectations calling for a 3.19mb draw (average of polls by Reuters and S&P Global Platts). Data for distillates and gasoline were also bullish as API showed a 1.90mb draw from distillate stocks, whereas forecasts called for a 0.91mb increase and the industry group reported a surprise draw of 0.72mb from gasoline stockpiles, while a build of 1.98mb was expected. Cushing, OK crude oil inventories rose by 0.13mb last week, per API. The more closely watched EIA report is due at 10:30am. Reuters reports that Senate Majority Leader Mitch McConnel put off a vote on increasing COVID-19 relief checks from $600 to $2,000 on Tuesday and urged senators to override the President's veto of a defense bill.
Asian stock markets closed mixed but mostly higher overnight with the Nikkei down 0.5%, while the Shanghai Composite added 1.1% and the Hang Seng rallied 2.2%. European shares were trading just south of the unchanged mark this morning. As of this writing, US stock market index futures were seeing gains of between 0.2% (Dow f) and 0.3% (Nasdaq f, S&P 500 f). Also supportive for crude oil prices, the US dollar continued its slide and was down 0.3%.
Petroleum futures strengthened yesterday amid weakness in the US dollar and mostly higher trade in European equities, despite losses in US shares. WTI crude settled 38 cents higher at $48.00/bbl and Brent crude rose 23 cents to close at $51.09/bbl. RBOB futures added 2.02 cents and settled at $1.3879/g and ULSD (HO) edged up 78 points to $1.4868/g. According to Platts, New York Harbor ULSD, HSHO, and ULSHO barge differentials to NYMEX held steady at -0.10c/g, -15.30c/g, and -8.50c/g, respectively. Propane prices mostly rose yesterday, per Platts, as Mt. Belvieu LST prices strengthened by 1.25 cents to 73.000c/g and non-LST prices also added 1.25 cents to 72.250c/g. Conway spot prices remained unchanged at 69.750c/g.
NYMEX natural gas futures jumped 16.2 cents to $2.467/mmBtu on Tuesday despite a looser market balance expectation for next week and a weaker two-week heating degree day forecast. The latest 1-5, 6-10, and 11-15 day forecasts (EC) continue to see above-normal temperatures across the eastern half of the country.
