Crude oil and refined products futures looked set for a third session lower, with further (albeit small) losses as of this writing in the overnight session. A fresh record in daily Indian coronavirus cases and weakness in US stock market index futures were unsupportive, whereas strength in European shares and a drop in Libyan oil production were supportive. The US dollar index appears to be steadying over the past three sessions, after depreciating sharply this month.
Reuters reports that Libyan oil production has fallen to about 1mb/d according to the country’s National Oil Corporation, from about 1.3mb/d. The NOC says production could drop further due to budgetary issues; NOC declared force majeure on exports from the Hariga oil port yesterday. In US supply-side news from Reuters, the Michigan Public Service Commission says that it will be considering the impact from greenhouse gas emissions in its decision on the construction of an underwater tunnel to rehouse a four-mile section of Enbridge Inc’s 540kb/d Line 5 oil and refined products pipeline. The line runs from Superior, WI to Sarnia, ON.
In economic news, Asian shares mostly strengthened overnight. While the Shanghai Composite lost 0.23%, the Hang Seng gained 0.47% and the Nikkei rallied 2.38%. European shares were strengthening this morning. The French CAC 40 was up 0.77% following encouraging data. The INSEE Business Climate Indicator for April came in at 104, up from an upwardly revised 99 last month and beating expectations at 99. The DAX in Germany was up 0.57%. The FTSE 100 in the UK was trailing with a 0.12% gain, following a miss in the CBI Industrial Trends index, which fell 8% rather than rising 2% as expected this month. US stock market index futures were in the red, with Dow futures down 0.04%, S&P 500 futures off 0.11%, and Nasdaq futures down 0.17%. Market participants looked ahead to the ECB policy decision, flash Eurozone consumer confidence for April, weekly US jobless claims and March existing US home sales figures for further direction.
The complex fell for a second session on Wednesday amid bearish US crude oil stock data in the weekly EIA report, despite strength in US and European shares and some slight weakness in the US dollar. Brent crude futures lost $1.25, closing at $65.32/bbl, and WTI dropped $1.32 to settle at $61.35/bbl. RBOB futures settled 3.40 cents weaker at $1.9834/g, and ULSD (HO) lost 2.64 cents for a $1.8537/g settlement price. According to Platts, New York Harbor barge price differentials to NYMEX mostly weakened yesterday. The ULSD differential fell by 10 points, to +0.00c/g and the ULSHO differential fell by 25 points to -16.00c/g, while the HSHO differential held steady at -25.75c/g. April propane prices strengthened yesterday, according to Platts. Mt. Belvieu non-LST prices climbed 1.000 cent higher to 74.750c/g and LST prices also gained one cent, reaching 74.625c/g. Conway propane prices gained once cent as well, hitting 70.250c/g.
NYMEX natural gas futures fell 3.5 cents to settle at $2.692/mmBtu yesterday with a weaker two-week heating degree day forecast. The latest 1-5 day outlook based on the European model calls for below-normal temperatures across most of the country, but the 6-10 day forecast sees above-normal temperatures for most of the East Coast and states just south of the Great Lakes. The EIA is due to release its natural gas storage report for the week ended April 16 this morning, and an analyst poll conducted by Reuters calls for a 49bcf injection. This would top the 43bcf injection seen during the same week last year, and also the 37bcf five-year average.
