Petroleum futures were seeing modest gains of under 0.5% as of this writing in the overnight session on Tuesday, on course for a third session higher. The gains came amid strength in global shares and a third session lower for the US dollar index. Market participants looked ahead to US housing market data for April for further direction.
Colonial Pipeline stated yesterday that its lines were fully operational. However, Reuters reports that some 11,667 gas stations were without fuel on Monday, mostly in the Southeast, compared to a peak of over 15,000 following the cyberattack on Colonial Pipeline.
Asian stocks strengthened overnight, with the Shanghai Composite up 0.32% and the Hang Seng climbing 1.42% higher. The preliminary estimate of Japanese GDP growth for the first quarter was released, showing a 1.3% quarterly decline – slightly worse than the 1.2% predicted contraction. It was not all bad news, however, as fourth quarter 2020 GDP was revised up from a 1.4% year-on-year contraction to a shallower 1.1% drop. The Nikkei jumped 2.09% higher. In European news, the UK ILO unemployment rate saw a surprise drop to 4.8%, and the claimant count unemployment rate came in at 7.2% last month, as expected. As of this writing, the FTSE 100 was up 0.38%. In other news, the Italian merchandise trade surplus was E4.9bn in March, down from E5.7bn in February, and the merchandise trade surplus for the Eurozone as a whole shrank from E23.1bn in February to E13.0bn in March as imports shot up 5.6% month-to-month. Still, first quarter Eurozone GDP growth was confirmed at -0.6% in the second estimate, as expected. The CAC 40 was up 0.10% and the DAX had gained 0.17%. Market participants looked ahead to US housing starts and permits data for April. Dow and S&P 500 futures were up 0.22% this morning, and Nasdaq futures had gained 0.56%. Also supportive for crude, the US dollar index was down 0.37% and seeing its weakest levels since February 25.
The complex rose for a second session on Monday, posting across-the-board gains of over one percent with weakness in the US dollar index and optimism with the reopening of the British economy, despite weakness in US and European equities. Brent crude futures rose 75 cents, closing at $69.46/bbl, and WTI futures strengthened 90 cents to settle at $66.27/bbl. On the product end of the barrel, RBOB futures climbed 3.17 cents higher, settling at $2.1583/g, and ULSD (HO) futures settled at $2.0604/g, up 2.42 cents. According to Platts, New York Harbor ULSD, ULSHO, and HSHO barge price differentials to NYMEX weakened yesterday with the return of service on Colonial Pipeline. The ULSD differential fell 65 points to +0.10c/g, ULSHO barge prices fell by 1.75 cents to -20.00c/g to spot NYMEX, and HSHO differentials tumbled 5.25 cents lower to -31.25c/g. May propane prices strengthened along with crude futures. Mt. Belvieu LST prices, per Platts, gained 1.25 cents to hit 82.625c/g and non-LST prices rose 1.125 cents to 82.000c/g. Conway spot prices strengthened 1.125 cents as well, to 80.625c/g.
NYMEX natural gas futures jumped 14.8 cents higher on Monday, settling at $3.109/mmBtu, with a stronger two-week cooling degree day forecast (GFS) and tighter expected US market balance this week (Refinitiv). Things remain quiet in the Atlantic, with no tropical cyclone activity expected over the next two days by the National Hurricane Center.
