Petroleum futures were seeing gains of over 7.5% in the overnight session on Monday amid news over progress in COVID-19 vaccine research, a possible extension of OPEC+ output cuts, a rally in European equities and mostly higher trade in US stock market index futures, despite an increasing Libyan oil output. Market participants had a quiet day ahead of them on the economic calendar.
Reuters reports that Pfizer’s experimental vaccine has been more than 90% effective in preventing COVID-19, based on initial data from a large study. Also in the news, Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman said that the OPEC+ deal could be adjusted if there is consensus among its members. With many in the media and elsewhere claiming that Joe Biden has won the US Presidential election-- in spite of mounting legal challenges surrounding alleged wide-spread voter fraud-- key members of OPEC worry that strains in the OPEC+ alliance could reemerge with a Biden presidency, according to OPEC sources, also stating that they would miss President Trump who went from criticizing the group to helping bring about a record oil output cut deal. In unsupportive news, Libyan crude oil production has increased more than 1.0mb/d, according to their National Oil Corporation.
Asian stock markets closed higher overnight with the Hang Seng rising 1.2%, the Shanghai Composite closing 1.9% higher, and the Nikkei gaining 2.1%. In European news, the German merchandise trade surplus widened from E15.4bn in August to E17.8bn in September, beating consensus at E15.8bn. European shares were rallying this morning with the FTSE 100 up 4.5%, the DAX having added 5.3%, and the CAC 40 having gained 6.4%. US stock market index futures were trading mixed but mostly higher as of this writing with Nasdaq futures down 0.8%, whereas S&P 500 futures had added 3.6% and Dow futures had jumped 5.2%. In unsupportive news, the US dollar index was up 0.1%.
Petroleum futures weakened on Friday amid a rise of 5 in the US oil rig count, fresh lockdowns across Europe with new surges in COVID-19 cases, and uncertainty over US presidential election results. WTI crude fell $1.65 to settle at $37.14/bbl and Brent crude lost $1.45 to close at $39.45/bbl. RBOB futures dropped 3.15 cents to $1.0844/g and ULSD (HO) futures fell 2.70 cents to $1.1426/g. According to Platts, New York Harbor ULSD, HSHO, and ULSHO barge differentials to NYMEX held steady at -0.35c/g, -11.00c/g, and -8.50c/g, respectively. Also per Platts, November propane prices fell along with crude prices Friday as Mt. Belvieu LST prices fell by 75 points to 55.750c/g and non-LST prices weakened by 62.5 points to average at 55.875c/g. Conway spot prices fell by 75 points, hitting 53.750c/g.
NYMEX natural gas futures fell 5.4 cents to settle at $2.888/mmBtu on Friday despite a tighter market balance expectation for this week, stronger two-week heating degree day forecast and a drop of 1 in the US rig count. The latest 1-5 day forecast (EC) still sees well above-normal temperatures on the East Coast, but mixed temperatures in the Midwest. The 6-10 day outlook is less supportive with above-normal temperatures expected across the eastern half of the country.
