Liquidity’s Daily Market Overview

The Iran war continues to put a strain on crude supplies and as a result is to impact refined fuel product supply. The markets are not seeing any easing of the problems surrounding crude oil flows out of the Mideast. Dubai and Oman crude prices for May delivery rose to $100 for the first time since 2022 as sour crude oil has been impacted the most by the disruptions in the Gulf.

Headlines from this morning: Kuwait Cuts Oil Production at Some Fields as Storage Fills Up -- WSJ. Saudi Arabia, U.A.E. Also Nearing Limits of Storage Facilities -- WSJ.  Restarting production can take days or even weeks depending on the reservoir. Storage is limited in the Middle East.

Qatar's energy minister told the Financial Times he expects all Gulf energy producers to ⁠shut down exports within weeks, a move he said could drive oil to $150 a barrel, according to an interview published on Friday. The Qatari minister also said that even if the war were to end immediately it would his country weeks to months to return to " a normal cycle of deliveries".

Sour crude prices have risen to fresh premiums versus sweeter crude grades. The Gulf disruptions has seen US Mars crude prices surge to multi-year highs. Mars crude is a high density, sour crude grade. (Quantum Commodities)

President Trump told Reuters in an exclusive interview on Thursday that he was ‌not ⁠concerned about rising U.S. gasoline prices linked to the conflict, saying "if they rise, they rise" and that the U.S. military operation was his priority.

The US has cleared the way for India to temporarily increase its purchases of Russian oil. A license issued late on Thursday covers transactions related to Russian crude oil and petroleum products loaded onto vessels before March 5, so long as it’s delivered to India and purchased by an Indian firm. The measure expires April 4 at 12:01 a.m. Washington time.  The US Treasury Secretary said :" “This deliberately short-term measure will not provide significant financial benefit to the Russian government as it only authorizes transactions involving oil already stranded at sea.”   Over 22 MMBBL of Russian crude are unsold or in idle tankers in Asia, with over 80% of the ships near India’s waters and in the Singapore Strait, according to ship-tracking data compiled by Bloomberg. Out of the roughly 5 MMBPD that India imports, just a fifth came from Russia in February, according to Kpler. ING commentary says that allowing India to buy Russian oil will ease some pressure off the market in the immediate, but the Strait of Hormuz remaining closed with the 20 MMBPD that transits there daily means that India's purchasing is not a "game changer" for the market. (Bloomberg)

China is in talks with Iran to allow safe passage for crude oil and Qatari liquefied natural gas vessels through the Strait of Hormuz. China sources about 45% of its oil from the Strait. Ship-tracking data showed that a vessel called the Iron Maiden passed through the Strait overnight Wednesday after changing its signaling to "China-owner. Crude tanker transits through the strait fell to four vessels on March 1, the day after hostilities broke out, versus an average of 24 a day since January, according to Vortexa vessel-tracking data. Around 300 oil tankers remain inside the Strait, according to Vortexa and ship tracker Kpler.  (Reuters)

On Thursday, Saudi Arabia announced its OSP's for April loadings, raising prices to all regions by a large amount, which is in step with the increase in Oman/Dubai premiums. The A-Light OSP to Asia rose by $2.50 from a $0 price in March. Medium and Heavy crudes to Asia were raised by $2.00.  Prices to NW Europe were raised by $3.50 across the board. The A-Light price to the Med was raised by $2.50, while all other grades were raised by $2.00.

Asian refining margins have surged to their highest since 2022 as Iranian threats to shipping through the Strait of Hormuz have disrupted crude oil flows and forced refineries to cut ‌runs, according to data and analysts. Singapore's complex refining margins , a proxy for Asia refining profitability, jumped to nearly $30 a barrel on Wednesday. Jet fuel and diesel led the surge in margins among products in Asia. The margin for the aviation fuel breached $52 a barrel on Wednesday to its highest since June 2022, more than double from Friday, LSEG data showed. Asian refiners, particularly state-held majors heavily dependent on Middle East oil supply, are considering slashing crude run rates by up to 30%. Cracks for 10ppm sulphur gasoil jumped to just above $48 a barrel, the highest since August 2022.   (Reuters/Oil Price) Tankers loaded from India destined for Europe have been diverting towards the East as Asia supplies deplete and refiners look to capitalize on firm Asian margins, according to  ship-tracking data from Kpler. (Quantum Commodities)

The retail fuel prices in the US have risen further today. Gasoline at the pump is up 6.9 cents from yesterday. Today's price is $3.320; one week ago the price was $2.982. The diesel pump price is up 16.4 cents today to $4.330. One week ago the price was $3.757. Commentary from Yahoo Finance citing analysts reads as follows:" Analysts say diesel markets are highly global and especially sensitive to shipping risks and maritime disruptions." GasBuddy commented: "With elevated tension in a key global shipping corridor, diesel is reacting more aggressively than gasoline." Diesel faces the most acute physical pressure in the near term, Kpler analysts say. The limited near-term alternatives makes the diesel supply risk even more acute than the risks for crude oil, jet fuel, and LNG. (Oil Price)

The energy market shrugged off today's US Non Farm Payroll data for February, which disappointed. February saw 92,000 jobs were lost. Consensus forecasts were for February to add 50,000 to 65,000 jobs. The revisions to January and December jobs data showed a further drop of 69,000 jobs from the prior data. 

Energy Market Technicals

The energies are overbought basis their stochastic and RSI momentum indicators. The energies continue to test their DC chart upper bollinger bands.

WTI spot futures have risen today to test some highs seen from April 2024 at 87.63-87.67. Further resistance above lies at 89.79-89.94 and then at 93.64-93.74. Support is possible at 83.53 and then at 81.15-81.18 from April 60 minute data.

Natural Gas Market Overview

Natural Gas--NG is up 12.6 cents at $3.129
NG futures are higher today, boosted by a supportive EIA storage number yesterday and an increase in NG power burn demand. A boost in some heating demand in the back end of the weather forecast is likely also supportive.

After a period of above normal temperatures in much of the US in the 6-10 day forecast, the 8 to 14 day period shows temperatures falling below normal in much of the eastern half of the US. (NOAA)

The EIA gas storage data issued Thursday was slightly bullish as the draw of 132 BCF beat news wire forecasts by 7 BCF. A rebound in NG power burns for heating demand was seen as a catalyst for the better EIA number. Total storage fell to 1.886 TCF, which is -43 BCF (-2.23%) versus the 5 year average, but +115 BCF (+6.49%) versus last year's storage level.

This latest week is also seen having had stronger gas power burns as a percentage of the total fuel demand. Celsius Energy says that the natural gas powerburn has averaged 36.9% of the powerstack. This is up +2.1% vs the same week last year, the most of any fuel component. This is a change from the past 6-12 months when the gas share often lagged the most of any fuel, Celsius adds.

In the LN/NG options on Thursday, the October November minus 15 cent call was sold against buying of the minus 50 cent put. The cost to the buyer was 1 and 2 cents. These were new positions as per CME open interest data. The October November futures spread settled minus 29.9 cents. 2,000 contracts of the January $10 calls traded 19.25 cents. The November $4 call was sold against buying of the December $5 call at a cots of 1.75 cents. With the call spread, there were delta futures trades as well with 0.43 delta November futures bought at $3.86 and 0.53 delta December futures sold at $4.58.

Notable from Thursday's settlements in NG futures was the strength in the December through February strip. Those contracts settled higher by 19.5 to 24.3 cents, while the spot April futures rose by (only) 8.6 cents. NGI commentary suggests that LNG demand possible next winter may have sparked the settlement increases.

Technically the NG spot futures remain in the range seen the past 2 1/2 weeks. Momentum remains positive basis the DC NG chart. Resistance  at 3.130-3.135 has been tested today with a high of 3.143. Next resistance above is seen at 3.188-3.190. Support lies at 2.973-2.975 and then at 2.910-2.912.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are higher as the Iran was "piles further stress on energy supplies", as Bloomberg's headline reads today. Spot Gasoil futures reached their highest level since October 2022 as the March futures traded as high as $1,130.

Arab states across the Middle East — as well as Israel — reported interceptions of Iranian missiles and drones into Thursday, with Qatar telling residents to remain indoors due to the high level of threat. Iran’s Islamic Revolutionary Guards Corps said retaliatory attacks will intensify in coming days, according to the (Iranian) Nour news agency.  Turkey came under fire on Wednesday, a first for a member of the North Atlantic Treaty Organization since the conflict began. Saudi Arabia continued to thwart attacks on Thursday, saying it intercepted multiple missiles and drones overnight. Strikes have mostly been directed at Al Kharj near Riyadh, where the US has a facility, or the east where Saudi Aramco operates its headquarters.  (Bloomberg)

While Iranian military commander Amir Heydari told state TV on Thursday the strait isn’t closed, traders and analysts still expect it will take weeks before flows can resume meaningfully. (Bloomberg)

The Chinese government has told its top refiners to halt diesel and gasoline exports. China is the 3rd largest supplier into the region. Japanese refiners asked their government to release oil from strategic petroleum reserves. Earlier this week, a major Indian processor advised customers it would suspend product exports.  (Bloomberg) Two oil refineries in China and India shut their crude units ⁠following the disruption to supplies, as both countries rely on Middle East crude imports. (Reuters) 

In an apparent widening of Iran’s attacks on commercial shipping in the Gulf a tanker in a port near Kuwait was hit with a large explosion Wednesday. An attack on a tanker at anchor in the port would represent significant widening of Iran’s strikes on shipping in the region. The latest attack adds to five others reported in the region in the last 24 hours.  (seatrade-maritime.com) Ship-tracking data compiled by Bloomberg show traffic through the Strait of Hormuz has plummeted by well over 95%, with major crude carriers and gas tankers avoiding the route. (Bloomberg)

Wednesday's DOE data showed crude supplies rising more than forecast. The increase of 3.20 MMBBL, was more than the estimates for a build of 1.6 to 2.3 MMBBL. Cushing oil supplies rose to their highest amount since August 2024. (Market News) Distillate supplies rose by 0.43 MMBBL, versus estimates for a draw of 2.6 to 2.8 MMBBL. Distillate demand on the week fell by 197 MBPD to 3.698 MMBPD. This figure lagged the prior 2 years demand by 293 and 376 MBPD. Gasoline demand also fell on the week and was well below the demand of the prior 2 years. Gasoline demand fell by 441 MBPD on the week to 8.292 MMBPD. This was 585 and 721 MBPD less than that seen in 2024 and 2025 respectively.

Retail gasoline and diesel prices in the US have risen further today, as per AAA data. Gasoline at the pump is averaging $3.251, which is up 5.3 cents since yesterday. One week ago the price was $2.983. Diesel at the pump is averaging $4.166 today, which is up 12.8 cents from yesterday. One week ago the price was $3.757. 

Energy Market Technicals

WTI, Brent and ULSD momentum basis the DC charts is getting very near overbought. RB and Gasoil basis their DC charts are overbought. ULSD, Gasoil and RB have stepladder up looks from this week's rally. The energies are again today testing the upper bollinger bands basis their DC charts.

Spot WTI sees resistance at 78.40-78.47 and then at 80.69-80.77 from weekly chart data. Support comes in at 74.37-74.41 and then at 71.63-71.65 from April's 60 minute chart data. The DC chart upper bollinger band lies today at 76.97.

Natural Gas Market Overview

Natural Gas--NG is 5.3 cents at $2.970
NG futures are up slightly having again tested $3 overnight. But, NG futures are struggling to rally as mild weather is set to engulf most of the US. Additionally some maintenance and issues at LNG export plants has seen feedgas demand fall in recent days.

Today's EIA gas storage data is seen as a draw of 125 BCF as per WSJ & Bloomberg surveys. This compares to last year's draw of 106 BCF and the 5 year average draw of 96 BCF.

U.S. feed gas nominations to Gulf Coast terminals have pulled back slightly over the week as disruptions at Cameron LNG and an end of elevated nominations to Golden Pass in Texas cut into overall demand. However, Wood Mackenzie estimated nominations to average 19.2 BCF/d over the next seven days, about 4 BCF/d above the year ago period. Maintenance events and shipping disruptions could see US LNG export shipments drop this week, despite the global LNG market seeing disruptions. (NGI)

The 81-4 day temperature outlook from the NOAA shows much of the Northern half of the US near normal while the Southern half will see above normal, but comfortable temperatures. As NGI says :"Heating demand for gas wavers. Overall gas demand was trending lower on widespread unseasonable warmth."

Demand for more shipping capacity and spot cargoes to Europe is triggering a shock in LNG vessel prices, especially for ships available to load U.S. LNG. The prompt average spot rate for vessels to Europe jumped $116,500 Wednesday to $278,250/day, according to Spark Commodities data. Rates for Asian shipping also rose by almost the same rate to $207,500/day.

Technically NG futures have positive momentum, but the price pattern suggests more of a trading range currently. Resistance comes in at 3.070-3.076 and then at 3.130-3.135. Support is seen at 2.910-2.912 and then at 2.818-2.826.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are mixed at this time--with RB up slightly, while crude oil and the distillates are lower. Conflicting news stories are moving the markets. As Bloomberg wrote today: " Oil pared gains on a report that Iran indirectly reached out to the US in a bid to end the war in the Middle East." But, prices were supported by news of another attack on the large Saudi Ras Tanura refinery. But, the energy markets have been pressured since yesterday after President Trump suggested the U.S. Navy could escort vessels through the Strait of Hormuz.

The New York Times reported that operatives from Iran’s Ministry of Intelligence reached out to the CIA through another country’s spy agency with an offer to discuss terms for ending the conflict. (Bloomberg)

A midday headline Tuesday suggesting that the US was considering offering oil tanker insurance to ease Mideast shipments saw energy prices pull back quite a bit. (Reuters) Trump claimed Tuesday that Iran’s “air defense, Air Force, Navy, and Leadership is gone.” (Bloomberg) The President that he had ordered the U.S. International Development Finance Corporation to provide political risk insurance and financial guarantees for maritime trade in the Gulf. (Reuters)

A second attempted attack on the large Saudi Ras Tanura refinery happened overnight. A Saudi defense ministry official stated that the attack did not damage the refinery nor has supply been disrupted, but that it was carried out by a drone. (Jerusalem Post/agbi.com)  The kingdom also confirmed it’s diverting supplies away from the Persian Gulf to the Red Sea as part of a plan to keep operations running.  (Reuters) Major oil storage sites in Saudi Arabia are rapidly filling up, according to Kayrros, a satellite imaging intelligence company. Four of the six tanks at the Ras Tanura refinery were full and the Ju’aymah terminal on the country’s east coast is quickly running out of spare capacity, they said.

Iraq is said to have had to cut some of its crude oil production due to the closure of the Strait of Hormuz. The closure is forcing the country to slow production at its Rumaila field and the West Qurna-2 project, Bloomberg reported. Iraq has cut output by nearly 1.5 MMBPD, about half its production, due to storage limits and ‌the lack ⁠of an export route, officials told Reuters. The sources further said the country may have to shut nearly 3 MMBPD of output within days if exports do not resume.

 
API                 Forecast           Actual
Crude Oil     +1.6/+2.3            +5.6
Gasoline       -0.8/-1.0           +3.286
Distillate      -2.6/-2.8            +0.516
Cushing           n/av                 +1.54
Runs            Unch/-0.3%          n/av

A Reuters analyst details how China's "buying spree" of crude oil may be slowing. Kpler data suggests Chinese crude oil imports from Nigeria and Angola are set to decline to 1.04 million barrels daily in March, from 1.25 million barrels daily in the final quarter of last year. African oil imports are also set for another decline in April, to 978 MBPD, the data shows. Freight rates for VLCC's from the Mideast to China have tripled since the beginning of 2026. The Reuters analyst adds that China, while not as sensitive to international oil prices as its neighbor India, is still sensitive to these prices. And it has built up a nice inventory of crude. A recent report said that Chinese refiners and traders have been buying record amounts of Russian crude, with the average daily for February estimated at close to 2.1 MMBPD, according to Kpler. That would be up from 1.7 MMBPD in January and a result of Indian refiners’ pullback under U.S. pressure to stop buying Russian crude. Because of that pullback, Russian oil is fetching even deeper discounts than before, which is very welcome news for Chinese buyers. But it is not only Russian crude that is getting discounted. Reuters’s Clyde Russell this week reported, citing traders, that Angolan and Nigerian sellers were also cutting their prices, with local crudes being sold at $5 discounts to Dated Brent, up from $3 earlier in February. According to Russell, this is an early sign that Chinese oil imports may weaken from April onwards, not least because of higher freight rates, which are hitting demand for oil from Western Africa—and for Middle Eastern oil.

The volume of WTI futures traded on the CME Tuesday was exceptionally heavy at 3,396,006 contracts. Can this suggest that an interim top was put in place for the WTI contract?

Open interest in RB & ULSD futures fell by 13,698 and 15,843 contracts respectively Tuesday. We suspect that this was overall more so shortcovering  happening. In ULSD the decreases were seen in the April through July strip. In RB, the decreases were seen in the April, June and September through November strip.

The retail prices for gasoline and diesel at the pump in the US rose quite a bit again today. Gasoline is up 8.9 cents from Tuesday, priced at $3.198. The diesel price today of $4.038 is up 14.7 cents from Tuesday.

Energy Market Technicals

Crude oil is having an inside trading day today versus yesterday's price range. The products made fresh highs overnight for the recent rally on the back of the news of the Saudi refinery attack. RB DC chart based momentum is overbought.

WTI spot futures have support at 71.63-71.70 and then at 70.09-70.16. Resistance lies at 75.69-75.75 and then at 77.23-77.32. The DC chart's upper bollinger band lies at 73.72.

Natural Gas Market Overview

Natural Gas--NG is down 8.9 cents at $2.965
NG futures are lower today as the market has seen the TTF marker retreat in the face of the story of Iran reaching out to possibly end the conflict. The TTF spot futures price is down almost 14% today. NOAA weather forecasts showing above normal temperatures focused in the Eastern and Southern portions of the US is also weighing on NG prices.

TTF European futures have retreated today after the very sharp rise seen the past 2 days. Prices rose by almost 70% in the past 2 trading sessions. Today's pullback is said to stem from a report from the NY Times that Iranian operatives have made an offer to discuss terms for ending the conflict with the U.S. and Israel. (Investing.com)

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are up strongly today as the conflict widens in the Mideast, heightening supply risks. The closing of the Strait of Hormuz has underpinned prices, but news wire reports tout the greater risk to energy infrastructure in the Mideast region as further supporting prices.

After the close of energy trading Monday news was seen on Reuters that " the Revolutionary guards commander says Strait of Hormuz closed, Iran to set on fire any ship trying to pass." Tankers and container ships are avoiding the waterway after insurers cancelled coverage for ​vessels and global oil and gas shipping rates soared. (Reuters) United Arab Emirates authorities are dealing with ‌a serious ⁠fire at Fujairah port, state media said on Tuesday. Iraq's Kirkuk crude oil loadings at Turkey's Ceyhan port stopped on Tuesday, a shipping source told Reuters. The U.S. embassy in the Saudi Arabian capital Riyadh was hit by Iranian drones, along with Amazon data centers in the UAE and Bahrain. (investing.com)  A fuel tank at Oman’s Duqm commercial port was hit in a drone attack. (Al Jazeera) Iran launched a drone attack on a US base in Kuwait on Monday. (Market News)  Israel struck targets in Tehran and Beirut early Tuesday, as Iran continued to fire at Israel and other targets in Gulf states, The Wall Street Journal reported. Senior US officials have indicated that a significant expansion of strikes targeting Iranian missile and naval assets is prepared for the next 24 hours. (Market News)

Fears are mounting over direct damage to Iran's production infrastructure, and the potential for prolonged retaliatory strikes. (Market News) President Trump said on Monday: "we projected four to five weeks but have capability to go far longer." Trump's comment regarding a possible timeline to the Iran conflict was :" whatever it takes." CNN's Jake Tapper quoted President Trump as saying: "we haven't even started hitting them hard, the big waves haven't even happened. The big one is coming soon". Iran’s capabilities to disrupt flows through the Strait "appear limited, and may degrade even further over time," analysts at Wolfe Research said. Wolfe research cites a reduced capability by Iran to effectively close the Strait. "Militarily closing the Strait at this point would need to be done through anti-ship ballistic missiles, cruise missiles, and drones, which the U.S. is actively working to neutralize," the analysts said. (investing.com)

The IEA says that it is ready to "stabilize the oil market." Bloomberg posted on X, highlighting a document prepared by the agency that outlines its commitment to addressing potential disruptions in oil supply. The IEA is currently holding a meeting. Bloomberg reports that the IEA's members have 1 billion barrels of oil in reserve. Bloomberg adds , though, that a document seen from the IEA states that it believes the oil market is ‘adequately’ supplied. The EIA estimated in June 2025 that there is around 2.6 MMBPD of spare capacity from the UAE and Saudi pipelines that could bypass the Strait of Hormuz, mostly by being loaded on the opposite coast along the Red Sea from the Persian Gulf, where the Strait of Hormuz lies.

From a demand perspective, there is an expectation that Asian refiners may cut crude processing rates by 20%-30% if disruption continues. Chinese refiner ZPC has already brought forward maintenance at a 200 MBPD CDU unit as a result of tightening crude supply, a trend that may continue.   (Market News)

Supertanker costs in the Middle East have hit all-time highs, according to shipping data and industry sources on Tuesday, as per Reuters reporting. The cost of a VLCC to ship crude from the Mideast to China rose to $423,736 / day.

Russia's Black Sea Novorossiysk oil loadings were suspended Monday due to a drone attack. (Reuters)

WTI futures volume traded on the CME in Monday's session was heavy.

Citigroup see oil trading in the $80-90/bbl range over at least the coming week while Morgan Stanley raised its Q2 Brent forecast to $80/bbl, Bloomberg said. Morgan Stanley's prior forecast was for Brent to reach $62.50 in Q2. A 3–4 week squeeze on Strait of Hormuz traffic could force gulf cooperation council output shut-ins and push Brent above $100/bbl, according to JPMorgan cited by Reuters.  An analyst at the Macquarie Group said that the world could handle the Strait of Hormuz being shut in for one or two weeks, but the impact on oil price would escalate rapidly after a third week and definitely after a fourth. The US is not currently discussing releasing oil from the SPR, as per Reuters. 

The retail fuel prices at the pump in the U.S. have risen quite a bit today from yesterday in step with the wholesale price increases seen in the futures markets. Gasoline at the pump has risen by 11.2 cents today to $3.109. Diesel prices have risen by 12.1 cents to $3.891. (AAA)

According to the Korea International Trade Association, Korea imports 70.7% of its crude oil and 20.4% of its LNG from the Middle East. Most of those volumes must pass through the Strait of Hormuz. The Korean government said, "Stockpiles of crude oil and petroleum products are sufficient for 207 days (about 6 months and 3 weeks)."   (biz.chosun.com) 

As to be expected given the price ranges and the underlying uncertainty over the events unfolding globally, volumes traded on the CME on Monday were heavy. WTI volume was almost 3 million contracts; usually daily volume is around 800-900,000 contracts , although last week with increased tension, volumes rose to near 1.4 million contracts traded. RB volume Monday was near 466,000 contracts; last week volumes were in the range of 200-220,000 contracts. ULSD/HO volume traded Monday was near 668,000 contracts; last week, the CME saw volumes in the range of 265-280,000 contracts.

Energy Market Technicals

The crude oils and the HO spot futures are not yet overbought, but the RB and Gasoil contracts are. The energies are all trading well above their DC charts' upper bollinger bands.

WTI spot futures have resistance at $78.40-78.47 and then at 80.69-80.77 from weekly chart data. Support comes in at 73.38-73.48 and then at 70.80-70.88 from 60 minute April chart data.

Natural Gas Market Overview

Natural Gas --NG is up 20.9 cents at $3.169
NG is up in step with other energies as global natural gas prices have risen dramatically on the back of worries over LNG supply. A slight rise in US weather demand is also helpful.

TTF European prices are up another 28% today after rising by 39% Monday. Currently, TTF spot futures are trading Euro 57/Mwh (=$19.49 /MMBtu). The high today is Euro 65.790/Mwh (=$22.35/MMBtu)  Benchmark Asian LNG ​prices rose as much as ⁠nearly 40% on Monday, as per Reuters reporting. The CME's JKM 2nd month May futures rose by 52.57%/$5.68 as per Monday's settlement of $16.485 /MMBtu. In a scenario where flows halt for one month, it is likely that the TTF and JKM benchmark gas prices could climb by 130% to approach 74 euros per megawatt hour ($25/mmBtu), Goldman said. Gulf producers have storage and tanker capacity to cover 25 days of stranded supply, JPMorgan estimates. (Reuters)

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are much higher today, gapping up over the weekend on the back of the US/Israeli attacks on Iran and the fallout from the attacks.

A wave of attacks on the Mideast region stretched into a third day, resulting in the suspension of most oil production in Iraqi Kurdistan and several major Israeli gas fields, throttling exports to Egypt. (Reuters) As one analyst quoted by Barron's said :" the Strait of Hormuz is effectively closed". Although Tehran maintains that the waterway remains open, several shipping companies have begun rerouting vessels away from the narrow passage as a precaution. (Trading Economics)  US Defense Secretary Hegseth said today that "this is not Iraq; this is not an endless war."  Hegseth further stated that the US' objective is to "destroy Iran's missiles, Navy and deny Iran nuclear weapons." (Bloomberg) Iran’s Supreme National Security Council Secretary, officially declared on Sunday : "We will not negotiate with the United States".  (Al Jazeera)

Saudi Aramco shut its Ras Tanura refinery after a drone attack.  The refinery is Saudi Arabia's largest with a capacity of 550 MBPD. (Reuters)  Asia's jet fuel and diesel cash premiums rose to 3 1/2 year highs today amid concerns over supply disruptions.  Asian Jet fuel cash differentials ended the trading session at a premium of $4 a barrel, LSEG pricing data showed, more than $2 higher than the previous close and at levels last seen in September 2022. Diesel cash differentials were at premiums of around $4.25 a barrel, levels last hit in November 2022. Benchmark European diesel refining margins rose about 26% on Monday, to their widest since November 20. Roughly 6 MMBPD of refined products flow out of the Persian Gulf. (ING) Nearly 600,000 metric tons of diesel flows per month from exporters in the Strait of Hormuz went to Europe last year, Kpler shiptracking data showed. Jet fuel flows on this route averaged 1.1 million tons per month. Around 40% of jet fuel exported from refiners via the Strait of Hormuz were bound for Europe last year, the data added.  (Reuters) 

The US and Israel launched attacks on Iran on Saturday, killing Iran's Supreme Leader and many key military officials. Iran retaliated, striking several different targets in the region. Ports in Dubai and Oman were hit by drones as Iran has launched missile and drone barrages at Gulf states. (Al Jazeera) Vessels in the area were instructed on Saturday by Iran's Islamic Revolutionary Guard Corps, the country's leading military intelligence force, over the radio that "no ship is allowed to pass the Strait of Hormuz," according to Reuters. At least three ships have been attacked near the Strait of Hormuz. At least 150 tankers have dropped anchor in open Gulf waters beyond the Strait of Hormuz, although a handful of Iranian and Chinese vessels have passed through today, according to ship-tracking platform Kpler. (BBC News) Insurers are reported to be pulling back on offering coverage on vessels in the region, hampering any oil flows even if ships wanted to try. (Market News) Marine insurers are cancelling war risk coverage for vessels and oil shipping rates are set to surge further. Brokers pegged the spot rate for hiring a very large crude carrier on the key Middle East to China route early in Asia on Monday about 4% higher than on Friday, or equivalent to at least $12 million.  (Reuters)

Indian refiners may revert to buying Russian crude oil amid the events unfolding in the Mideast. The state-held refiners of India, the world’s third-largest oil importer, and Indian government officials met over the weekend to discuss emergency supply plans following the events in the Mideast. India’s current commercial and strategic crude reserves could be sufficient to cover only two weeks of consumption, the sources have told Bloomberg. India has drastically reduced intake of Russian crude in recent weeks, while boosting imports from the Middle East, Venezuela, West Africa, and the Americas. (Oil Price)

The Baker Hughes oil rig count issued Friday showed a drop of 2 units.

CFTC data seen Friday showed increases for the RB,ULSD and WTI net length held by money managers. WTI net length rose by a total of 13,173 contracts on ICE/CME combined for the week ended Tuesday Feb. 24. RB net length rose by 11,085 contracts, while that for ULSD rose by 9,933 contracts. 

Energy Market Technicals

The energies have gapped up over the weekend. The RB gapping up over the weekend is also a function of the nearly 21 cent premium that April had over the expired March futures contract. The spot RB and WTI futures saw their session highs on the opening of the market last night, while the ULSD & Gasoil have since made fresh highs. The energies are trading over their DC chart upper bollinger bands. Momentum for the RB and Gasoil are near overbought. Brent and WTI DC chart based momentums have turned positive with today's rally. ULSD DC chart based momentum is trying to turn positive from a neutral condition.

WTI spot futures see the DC chart upper bollinger band intersecting at 69.90. Resistance above comes in at 75.08-75.18. The overnight high is 75.33. Support is seen at 70.41-70.51 and then at 69.20, which is the overnight low. There is a gap down to 67.83.  The WTI weekly chart's upper bollinger intersects at 71.82. Weekly chart momentum looks to be cresting. 

Natural Gas Market Overview

Natural Gas--NG is up 13.6  cents at $2.995
NG prices have risen in tandem with the other energies after a tepid opening last night and are supported by the news from Qatar of a force majeure on LNG deliveries. TTF European prices have risen dramatically.

Qatar today has declared force majeure on LNG deliveries. (Bloomberg) Qatar's government said an energy facility belonging to gas giant Qatar Energy was attacked by two Iranian drones on Monday, with authorities still assessing the damage. (Reuters) About 20% of global LNG exports come from the Gulf, primarily Qatar, and are shipped through the Strait of Hormuz, according to data from energy consulting firm Kpler. (CNBC) TTF European spot futures have risen dramatically, gapping higher over the weekend. Currently the TTF spot futures are trading up almost 50% from their Friday settlement.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are higher as reports have surfaced of US and Chinese government agencies suggesting/authorizing citizens leave the Mideast region.

Overnight the US government authorized he departure of some embassy personnel and their families from Israel, due to safety risks. This was seen in an embassy post on "X".  Also today adding to the underlying tension felt in the region, China warned citizens to evacuate from Iran "as soon as possible", as per a Chinese state agency report.  (Reuters)

Thursday saw volatile trading in energies as headlines boosted prices after the 9 AM NY opening. Key to the rise in prices were news reports suggesting the US might seek a hardline approach to their talks with Iran. Reports were of the US seeking to have 3 major nuke facilities in Iran dismantled and all uranium returned to the US. These possible proposals were seen being rejected by Iran. Iran’s state media reported that Tehran won’t allow enriched uranium to leave the country, as per Bloomberg reporting. Towards the end of the trading session, energy prices fell off as Omani mediators said that "significant progress" had been made in the US-Iran talks. The Iranian Foreign minister also described the talks as having made progress.  This news came even as reports surfaced that US envoys Witkoff and Kushner were "disappointed wit morning talks with Iran."   The next round of talks at a technical level is expected next week.  (Bloomberg)

Additionally adding to some of the underlying tension re the Mideast situation was a news report Thursday that the US navy was reducing personnel in Bahrain to "mission critical". The last time such a notice was issued was before the June attacks by the US on Iran. (Fox News)

OPEC+ has a meeting set for Sunday, at which they may raise production for April by 137 MBPD. The increase would bring an end to a three-month pause in production increases. (Reuters)

Russia is likely to cut oil exports from western ports by 10% in March from February to 1.8 MMBPD, Reuters sources say. Oil loadings are expected to fall at Primorsk, Ust-Luga and Novorossiysk ports in March amid Western sanctions that are reducing Asian demand for Urals and complicating access to tanker capacity. Ice conditions have gotten worse, causing shipping routes to lengthen. February loadings saw a 9% decline in volumes from January to approximately 2.0 MMBPD from January's rate of 2.2 MMBPD.

The weakness we highlighted yesterday in the N. Sea crude market is reflected in the settlement in the spot Brent futures spread seen Thursday. The April May spread fell by 25 cents and settled at negative 9 cents. The spread has weakened further today. At 7 AM (EST), the spread was printing down 17 cents at minus 26 cents.

Crude inventories in EU-16 countries fell for the second straight month in January, OilX data showed Friday. Stockpiles were seen at a 7 month low.  (Quantum Commodities) Yet, production at Kazakhstan's largest oilfield has recovered to near full capacity after a transformer fire knocked out power supply on 18 January. (Quantum Commodities)

Mexico's crude exports dropped to a fresh multi-decade low in January. This prospect was highlighted weeks ago as the Mexican government seeks to increase their refinery utilization, thus exporting less crude oil. We wish to add that Mexico's crude exports may be lessened as the US imports more Venezuelan crude oil. The flagship Mexican Maya crude and Venezuelan crude oil are both heavy, sour crude grades, that are crucial for complex U.S. Gulf Coast refineries. (S&P Global)

A Bloomberg survey is calling for the Saudi OSP to Asia for April loadings to be hiked by 80 cents. That is after the March OSP was lowered last month by 30 cents to a Flat value versus the Oman/Dubai average. The March OSP was the 4th straight month of a decline in the price, signaling weak demand and high supply.

Supply risks from ongoing geopolitical tensions have prompted analysts to raise their oil price forecasts for the year, despite concerns that an oversupply will continue to weigh on the market, as per this month's Reuters survey. The 2026 Brent oil price forecast was raised from last month by $1.83 to $63.85. The 2026 WTI prices forecast was raised by $1.66 to $60.38. The analysts surveyed put the current risk premium in oil prices at $4 to $10.

Today is the last trading day for the March RB & ULSD futures, as well as the April Brent futures.

Energy Market Technicals

Natural Gas Market Overview

Natural Gas-- NG is up 4.9 cents at $2.876
NG spot futures are higher today with the latest GFS runs and ECMWF agreeing that March 13-14 could see the HDD count reversing and trending upward back to normal levels.

Thursday's weaker settlement for the April futures was seen as a function of the overall warmer weather being forecasted and the EIA gas storage data showing a very low draw versus the average for the period.

The EIA gas storage data issued Thursday showed a draw of 52 BCF, which was 1 to 3 BCF less than news wire survey forecasts. Total storage fell to 2.018 TCF. This saw the deficit to last year's inventories turn to a surplus of 141 BCF (+7.51%) . The deficit to the 5 year average shrank to 7 BCF (-0.35%). Celsius Energy sees the storage report as somewhat bullish : "  On a temperature-adjusted basis, the withdrawal actually averaged 0.8 BCF/day tight, or bullish, versus the 5-year average, the tightest so far in 2026, likely due to stronger LNG export demand, weaker imports, and a pullback in production." They see the slightly bearish report as being totally due to "unseasonably mild temperatures". 

Celsius Energy reported yesterday that real-time gas storage inventories had fallen below 1.9 TCF. They then posed the question as to whether inventories would fall below 1.8 TCF--they are not sure. Given that they see the next 3 weeks gas storage data drawing a total of 65 BCF, the answer to that question looks to be "no".

Notable options activity in LN/NG trading seen Thursday occurred in the April $2.75/$2.50 put spread. The spread was bought for a cost of 3.4 and 3.6 cents with 0.12 delta futures buys at $2.79. The April $2.70/$2.50 put spread traded in a 1 by 2 ratios for a net cost of 1.7 cents. The June $2.75 put was sold against buying of 2 times as many $2.50 puts for a net cost of 0.5 cents. The June options were opening of new positions.

Technically, yesterday's settlement for the spot futures was the lowest seen since September 22. The DC chart gap to 2.895 from the March expiration was almost filled today with a current high of 2.894. Resistance above that comes in at 2.930-2.934 and then at 3.000-3.006. Support is seen at April lows from this week. Support is likely at 2.818-2.826, which are 3 of the past 4 lows. Support below that is likely at yesterday's low of 2.775. Momentum is neutral.  

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are lower now after rallying to start the overnight session. The large crude build seen in the DOE data is said to be weighing on the market. The market will be keenly focused today on the US-Iran talks that are set to resume, with a market commentary suggesting that there is " an easing risk sentiment" surrounding the talks.

Oman's foreign minister says talks are going “constructively” and negotiators are “open” to new ideas and solutions, according to Oman News Agency cited by Bloomberg.  “Iran has come here with very reasonable amount of flexibility,” an Iranian Foreign Ministry Spokesman said. (Bloomberg)

Wednesday's DOE data showed a very large crude oil inventory build of 15.989 MMBBL. The build was the largest in 3 years. (Reuters) But, part of the build was due to the EIA's accounting adjustment. The EIA accounting adjustment added 2.739 MMBPD to inventories--which equates to 19.713 MMBBL. The increase in net crude imports of 2.884 MMBBL and the drop in refinery inputs/demand of 2.912 MMBBL ---suggest that the crude inventory build should have been nearer to 5.8 MMBBL. The crude oil build in the Gulf Coast region was nearly 14 MMBBL. But, Reuters adds that since the start of the year, crude oil inventories have risen by a total of 12 MMBBL – a smaller increase than the average of 15 MMBBL over the last ten years. Distillate supplies rose this week  by 0.252 MMBBL, versus forecasts for a draw of upward of 2 MMBBL. Distillate demand fell on the week by 858 MBPD to 3.895 MMBPD--lagging last year's demand by 207 MBPD, but beating 2024 demand by 359 MBPD. Distillate supplies rose most in the West Coast region. Gasoline demand was down 16 MBPD to 8.733 MMBPD, but this still beat the prior 2 years figures by 279 and 266 MBPD.

Reuters details how Saudi Arabia has raised oil production and exports as a contingency for any disruption in Iranian oil flows in case of a US attack. Last year, Saudi Arabia lifted oil exports in June by around 0.5 MMBPD, shipping more crude to overseas storage, just as the United States attacked Iranian nuclear sites. The plan this year is similar to 2025, according to the two Reuters' sources.  Iran has accelerated crude loadings in recent days, potentially preparing for disruption amid rising US-Iran tensions, Bloomberg said on Wednesday.

Weakness in the North Sea physical oil market is weighing on oil prices, said UBS' analyst. Bloomberg reports that the North Sea crude market is flashing signs of weakness as heavy buying from 2 large recent buyers subsides. North Sea oil production is experiencing a 2026 resurgence in supply, with loadings hitting an eight-year high of 2.1 MMBPD. North Sea oil loadings are hitting their highest rates since 2017, driven by new fields like Norway's Johan Castberg.  Prices for key North Sea grades have tumbled in recent trading sessions. WTI Midland — one of the six crudes that underpin Dated Brent — traded at a two-month low of $1.70 a barrel above the global benchmark on Monday, according to traders monitoring the Platts pricing window run by S&P Global Commodity Insights. The weakness may deepen in the weeks ahead, with additional Kazakh barrels returning to the Mediterranean and Northwest Europe following earlier disruption, and high freight rates discouraging purchases by buyers in Asia. The upcoming refinery maintenance season in Europe is seen adding to the weakness in the North Sea market.    (Bloomberg)

Russia fired a barrage of drones and missiles at Ukraine’s energy sector and railway infrastructure overnight on Thursday, injuring dozens of people, damaging residential buildings and triggering fires, officials said.  (Reuters)

Energy Market Technicals

Momentum for the energies has turned negative.

Spot WTI futures see support at the overnight low at 63.60-63.65. Below that support lies at 62.86-62.89. Resistance comes in at the overnight high at 65.83-65.85.

Natural Gas Market Overview

Natural Gas --NG is down 7.2 cents at $2.796
NG futures are lower as mid-March weather is seen warming up, with the market thus loosing demand. As one comment read:" benign weather lies ahead." Today's well below average EIA gas storage data is also likely weighing on prices.

The EIA gas storage data due today is seen as a draw of 53 to 55 BCF, as per WSJ and Reuters survey estimates. This compares to last year's draw of 252 BCF and the 5 year average draw of 168 BCF.

The NOAA 6-14 day charts show above normal across most of the country. The latest weather runs have shed more HDD's (Heating Degree days). NatGasWeather shows a loss of 12 HDD's.

Yesterday, Celsius Energy said that US natural gas production had fallen to 107.5 BCF/d after a recovery to higher amounts in early February. Celsius Energy pointed out that Wednesday output was up ("just") 2.2 BCF/d versus year ago level, adding that the rise in feedgas volume for LNG export had risen by 2.6 BCF/d over the year ago level.  BNEF data has NG output today at 112.71 BCF/d, down from Monday's production of 114.29 BCF/d, and comparing to an average of 113.46 BCF/d over the previous week.

NGI’s Spot Gas National Average was up 5.5 cents on Wednesday to $2.345/MMBtu. The Henry Hub cash gas next day price was up 1.5 cents to $3.01, which helped boost the March futures some into expiration.

The March NG futures expiration was quiet. NG futures volume on the CME was light at 333,009 contracts. That may have been partially a function of the 50 minute halt in trading on the CME platform due a technical issue. 

There is a rollover gap as April has become the spot futures contract. The gap goes from the March low yesterday of 2.895 to the session high today for April of 2.891. Today's low in the April futures is the lowest spot NG futures price seen since September 23. The April contract has a gap to fill down to 2.766. Support below that comes in at 2.725 from DC chart data. Resistance lies at 2.930-2.934.

Despite today's drop to a fresh DC low, momentum remains positive. Notable is the narrowing of the DC chart's bollinger bands. Tightening or narrowing Bollinger Bands on a price chart signal a period of low volatility, indicating that the market is consolidating. It indicates that the current low-volatility state is unsustainable. It serves as a precursor to an explosive, high-volatility breakout in either direction.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energy Market Technicals

Momentums, while still positive, look poised to turn negative within a day or 2.

Spot WTI sees support at 65.00-65.05 and then at 64.06-64.15. Resistance comes in at 67.28 and then at 67.74-67.76.

Natural Gas Market Overview

Natural Gas--April NG is up 4.1 cents at $2.872
NG futures are now higher --after falling to a fresh low overnight for the recent selloff. The March NG futures expire today and yesterday's next day cash was trading near $3.00 ---thus that may be a supportive element in the immediate that could see March rise today, given that the lows of yesterday/today for the March NG were near $2.90. But a sustained rally for the  NG complex seems unlikely without a significant shift in weather demand, which has dropped quite a lot in recent days' forecasts.

Average Lower 48 US states temperatures are forecast to briefly dip below normal in early March before a trend back above normal through the second week of the outlook. The NOAA 6-14 day charts show above normal across most of the country. (Market News) NGI said yesterday: " seasonally mild weather is on tap for most of the country over the next few days." As one commentary read yesterday: "winter is losing its bite".

On Tuesday, we saw a very large amount of April TAS contracts trade on the CME. We suspect that this was an effort to close out positions at the prevailing futures settlement price Tuesday, to lock in that price and close out positions ahead of April becoming the spot futures contract, and with it the higher margin costs.

Natural gas futures open interest on the CME rose Tuesday by 26,493, even with March open interest falling by 11,368 contracts. We see this as mostly new short positions. The increases were in the April through September strip and in the January and February 2027 contracts.

Technically,  April NG has momentum that is trying to turn positive from an oversold condition. Support is seen at 2.793. The gap on the April daily chart goes down to 2.766. Resistance above comes in at 3.020-3.025. 

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energy Market Technicals

Momentum remains positive for the energies and not yet overbought.

But, we see a bit of a wall of resistance having formed currently in WTI spot futures from the highs of the past 4 sessions. Those highs lie between 66.90 and 67.28. The DC chart's upper bollinger intersects at 67.12. Above the recent highs, next resistance is seen at 67.74-67.76. Support lies at 64.88.

Natural Gas Market Overview

Natural Gas--April NG is down 4.2 cents at $2.879
NG futures are lower again today after reversing course yesterday from a very strong opening Sunday evening to end the day lower.

The strength in the European weather model seen over the weekend was dialed back in the following 2 weather forecast runs, hence the NG market retreated. Today, heating demand keeps diminishing as the latest GFS run confirms warmer weather in the 6-10 day period.  The Heating Degree Days count for the 6-10 day period in the Lower 48 US states fell by about 17 since the last run, now at 85 HDD. This is about 9 HDD below normal for this time of year. (Market News)

The EIA gas storage data due this week is seen as a draw of 34 BCF to 54 BCF. NGI says that this week's draw could be the 2nd smallest for February since 2010. Last year's draw for the period was 252 BCF and the 5 year average draw is 152 BCF. So this week's data will see the deficit to last year turn into a surplus. The low withdrawal expected this week is said to be due to the warmer temperatures across the Lower 48 last week. (NGI) Dry natural gas production in the Lower 48 averaged 110.2 BCF/d last week, up from 109.3 BCF/d the week before, as per Wood Mackenzie data.

Financial firm LSEG said average gas output in the Lower 48 states has climbed to 108.7 BCF/d so far in February, up from 106.3 BCF/d in January. That compares with a monthly record high of 109.7 BCF/d in December.

LNG feedgas volume in February is on track to set a record, having risen to 18.6 BCF/d, thus beating December's record by 0.1 BCF/d. January saw average feedgas volume of 17.8 BCF/d. The LNG feedgas volume is seen rising further in the coming week's as Exxon's Golden Pass facility is expected to ramp up further.

The Desk's weekly survey for end of March (EOS) gas in storage rose by 42 BCF to 1.790 TCF. The EIA in its monthly STEO this month projects EOS at 1.866 TCF. The Desk's weekly survey for EOS in October of this year rose by 41 BCF to 3.821 TCF. This compares to the EIA's forecast of 3.988 TCF. 

In the Asian LNG market, the Asian spot price slipped to $10.60 per million British thermal units (mmBtu) in the week ended February 20, down from $10.65 previously, and also down 8.6% from the high so far this year of $11.60, reached in the week to January 30. The current spot price is for April delivery cargoes, and therefore reflects the softer demand expected in the shoulder season. The price "slipped' due to robust growth in supply, especially from the United States, and also by muted demand for spot cargoes from China, the world's biggest LNG buyer. China's imports dropped to a forecast 3.38 million tons in February, the lowest monthly total in Kpler data since April 2018 and down from 4.47 million (-15% ) in February last year. Effectively China has been shunning spot cargoes with the bulk of imports being delivered under long-term contracts. This is partly because of the mild winter across much of China reducing LNG demand and because the spot price is not competitive with the domestic price in China, which sit below $10.    (Reuters)

The absence of China in spot LNG markets has allowed Europe to increase imports to meet winter demand, with Kpler forecasting record arrivals of 14.20 million tons in February, besting January's record and up 22% from a year ago. The US is supplying 57% of the LNG imports into Europe as per Kpler data. Russian LNG is still arriving in Europe. Russia is still the continent's second-biggest supplier. The bottom line conclusion from a Reuters analyst regarding the global LNG market is as follows:" The increase in U.S. exports is likely enough to maintain the current equilibrium in global LNG markets, where strong demand in Europe and steady imports in Asia are offset by sufficient supply growth."

The March LN/NG options expire today. The $3.00 strike has a total of over 71,000 contracts open as per Monday's open interest data on the CME. We wonder if this will act as a magnet for the March futures settlement today.

Technically the April NG futures have reverted to a neutral momentum condition due to the pullback seen the past 24 hours. Today, the April contract has reached into the gap on the daily chart from a little over one month ago. The gap created then went from 2.867 to 2.766. There is support at 2.793-2.804, above the closing of the gap. Resistance is likely at 3.020-3.023 and then at 3.130-3.135.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are higher now after trading lower overnight as the US & Iran are set to resume talks this week. The rebound is likely due to a weaker US dollar as a result of the Supreme Court ruling Friday striking down President Trump's tariffs and his announcement since that he will levy new ones. Also continued concern over geopolitical tension is likely supporting prices again today. 

Bloomberg reported Sunday that talks between the US & Iran are set to resume this Thursday (Feb. 26) in Geneva.  Iran’s window to reach a diplomatic agreement over its atomic activities is at risk of closing, according to the head of the United Nations nuclear watchdog. (Reuters) US Special Envoy Witkoff told Fox News on Saturday that “zero enrichment” would be a non-negotiable term for a deal, contradicting a semi-official Iranian Students’ News Agency report that the US has accepted Iran’s red line of continuing to enrich uranium.  “First of all, enrichment is our right,” Iran's Foreign Minister said Sunday. He told CBS on Sunday he saw a “good chance” of a diplomatic solution to the standoff over his country’s nuclear program, while reiterating Tehran won’t be pressured by the US military buildup. (Bloomberg)

Separately, the Financial Times reported on Sunday that Iran agreed to a €500 million deal to acquire thousands of advanced shoulder-fired missiles from Russia over the course of three years. (Bloomberg)

Some analysts believe that the current geopolitical premium is too small, given what could happen to oil flows in the Mideast. One Reuters analyst, in particular, speaks of the "what if" Iran were to unleash attacks against other Gulf region oil infrastructure; the analyst adds that the market is not really foreseeing a disruption to flows through the Straits of Hormuz. He adds that the market's consensus range for the risk premium is around $7 to $10 a barrel. BNEF puts the premium at $4. BNEF postulates that markets are likely pricing in potential tanker seizure or disruption to Iranian energy infrastructure. Bloomberg writes :" Oil time spreads are reacting to the increased risk. Brent’s one-year spread moved to the widest backwardation — a market structure that signals tighter near-term supply — since June." The April 2026 April 2027 Brent time spread is worth about $5.41. At the beginning of January, the spread was trading near flat.

The energy markets have been roiled --as have the equity and gold markets -by the uncertainty caused by renewed trade-war fears with the Supreme Court's ruling Friday striking down President Trump's tariffs. Trump said on Saturday that he would raise a temporary tariff from 10% to 15% on U.S. imports from all countries, the maximum allowed under the law, after the U.S. Supreme Court ruling. (Reuters)

Friday's CFTC report of money managers positions showed a very small change in the WTI futures/options position on ICE/CME combined with net length falling by 2,904 contracts. RB net length fell by 2,014 contracts, while money managers reduced their net length in ULSD by 7,724 contracts to 12,592 contracts. The CFTC report was for the week ended Tuesday Feb 17. Brent net length fell by 17,876 as longs liquidated. (ING)

CME open interest data from Friday's trading shows ULSD futures open interest fell by 11,127 contracts, which we see as long liquidation in the March and April contracts.

The Baker Hughes oil rig count was unchanged in Friday's report.

The U.S. retail diesel price at the pump has risen further today to a fresh high since December 5th. Today's price is $3.712. One month ago the price was $3.554 as per AAA data.

Energy Market Technicals

The lows of the session for WTI, RB & ULSD were seen on the Sunday evening opening. The mean reversion setups from Thursday's closes above the upper daily chart bollinger bands were confirmed for RB and CL with Friday's settlements back below the upper bollinger bands. This suggests that some profit taking would be seen as was the case Friday afternoon into last night. Momentum remains positive for the energies.

Spot WTI futures see support at 65.00-65.03 and then at 64.14-64.15. Resistance comes in at 67.05. The DC chart's upper bollinger band lies near there at 67.08. Above that resistance comes in at 67.74-67.76 and then at 68.91-68.96.

Natural Gas Market Overview

Natural Gas--April NG is up 3.3 cents at $3.017
NG futures are higher as, over the weekend, European weather models added quite a bit of demand to the 7 to 14 day forecast, although a portion of that increase was given back in the latest European model's run from earlier today, thus making for a much smaller rise in NG prices today.

Over the weekend, the European and GFS weather models differed greatly as to the forecasts for HDD's in the coming 7-14 day period. The GFS has trended milder for the 7-14 day period while the ECWMF has pivoted colder with multiple waves of arctic air east of the Rockies. (Celsius Energy) NatGasWeather showed the European model adding 30 HDDs to the forecast versus Friday, while the GFS model reduced its totals by 15 HDDs. Since that forecast, the European model gave back 21 HDD. Increased wind generation may also reduce some demand near term, with Celsius Energy putting today's displacement of natural gas demand at 0.7 BCF/d versus yesterday.

CFTC data seen Friday showed money managers added to their net short position in futures/options. Net shorts rose by 18,712 contracts to a total of 26,840 contracts. This was achieved through new short positions added in the week ended Tuesday Feb. 17.

Gas storage inventories in Germany are at their lowest level since 2011, as per GIE data. European storage as of February 18 stood at 31.97% versus the 5 year average of 48.6%. (Reuters/Market News)

The Baker Hughes gas rig count was unchanged in Friday's report.

The March LN/NG options expire tomorrow Tuesday 2/24. As of Friday's close, the following options' open interest data from the CME showed the March $2.75 put with 41,704 contracts open, the $3.00 put with 54,252 contracts open, the $3.25 puts with 26,672 contracts open and the $3.50 puts with 25,269 contracts open. In the March  calls, the $3.00 strike has 16,880 contracts open, the $3.25 call with 17,990 contracts open and the $3.50 calls with 30,626 contracts open. Notable in trading of the expiring LN/NG March options were the $3.00 puts. They traded 5,000 contracts worth early in the day at 10.5 cents cost with the March futures worth about $2.97. At midday, with March futures having risen to near $3.14, the March $3.00 put traded 2,000 contracts worth at 4.8 cents.

In Friday's activity on the CME, the March April CSO flat puts traded actively at 1.7 and 1.6 cents. The open interest in the option fell by 7,400 contracts. In the October January CSO,  positions were opened in the -$1.50 and -$2.00 put strikes. A trade was executed in a 1 by 2 ratio, as the -$1.50 put was purchased against selling of 2 of the -$2.00 puts for a net cost of 2.3 cents. 

Technically, the April NG has positive momentum rising from an oversold condition. The high of the session today of 3.150 was seen on the opening last night as prices gapped up to begin with. Support for the April futures is seen at 2.910-2.911, which is the double bottom from Thursday/Friday of last week. Resistance lies at 3.201-3.206.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Overnight the energies made fresh highs for this rally--but have since retreated with crude oil lower now, RB near unchanged and the April HO still in positive territory.  The underlying worry mentioned in news wire commentaries is that the US is only a matter of days away from making some attack on Iran if they do not agree to a deal. "The heightened uncertainty that the market faces over the next two weeks suggests that oil prices are likely to continue to price in a large risk premium," ING analysts say.

Energy prices were volatile on Thursday as President Trump made several comments regarding talks with Iran and potential outcomes. President Trump warned Iran on Thursday it must make a deal over its nuclear program or "really bad things" will happen, and set a deadline of 10 to 15 days, drawing a threat from Tehran to retaliate against U.S. bases in the region if attacked. (Reuters) Crude prices fell 50 cents quickly mid-morning Thursday as President Trump said that "good talks being had with Iran", but demanded that Tehran reach a "meaningful" agreement. A few minutes later, Bloomberg quoted him as saying :" "we have some work to do with Iran".

"They can't have a nuclear weapon, it's very simple," President Trump said. "You can't have peace in the Middle East if they have a nuclear weapon." Iran has resisted making major concessions on its nuclear program, though insisting it is for peaceful purposes. Earlier on Thursday, Russia warned against an "unprecedented escalation of tension" around Iran on Thursday and urged restraint amid the U.S. military buildup in the region, which a senior American official said should be complete by mid-March. In a sign of growing concern over the increased tensions, Poland on Thursday became the latest European country to urge its citizens to leave Iran.  (Reuters)

Thursday news surfaced that memorial ceremonies across multiple cities evolved into small but symbolic anti-government protests in Iran. (Oil Price)

The DOE petroleum data seen Thursday showed a sizable draw in crude oil, propelled by lower net crude imports of 1.132 MMBPD (=7.924 MMBBL). Crude oil exports rose by 851 MBPD. Distillate inventories fell by 4.566 MMBBL, besting forecasts for a draw of upward of 2.0 MMBBL. Distillate demand rose on the week to 4.753 MMBPD --beating the prior years demand by 389 and 813 MBPD. Gasoline supplies fell by 3.213 MMBBL, beating the forecast for a draw upward of 1.2 MMBBL. Gasoline demand rose by 449 MBPD to 8.749 MMBPD--beating the prior 2 years demand by 510 and 549 MBPD.

The national average diesel price at the pump in the US rose today to its best value since December 5. Today's price is $3.690, as per AAA data. This is up from the price seen one month ago of $3.514.

Energy Market Technicals

April RB sees support at 2.2120-2.2134. Resistance from DC chart data is seen at 2.2761. The daily chart upper bollinger band lies at 2.2524.

Natural Gas Market Overview

Natural Gas--April NG is +0.1 cents at $2.947
NG futures are unchanged now after spending much of the overnight in slightly negative territory. Prices are supported somewhat as cold weather grips much of the US over the next few days and the latest 15 day forecast is said to have added demand. As one colleague says : "natural gas is in search of a catalyst." Yesterday's EIA storage data disappointed and next week's storage number is seen as very weak. 

The latest GFS 6z ( 1 AM EST)  run's 15 day forecast is 31 HDD higher nationally driven by early March. (Market News) The Commodity Weather Group said Thursday that forecasts shifted colder, with below-average temperatures expected in the western US through February 23.

The EIA storage number issued Thursday disappointed somewhat as inventories fell by 144 BCF, which was 5 to 8 BCF below the Bloomberg and WSJ forecasts. Total storage fell to 2.070 TCF. This was still 59 BCF (2.77%) below year ago level and 123 BCF (5.61%) below the 5 year average. But, next week's storage data will show a draw that is significantly below the 5 year average draw. Celsius Energy is forecasting a draw of 56 BCF, which would be 112 BCF less than the 5 year average.

Estimates for end of season natural gas inventories varied in comments seen Thursday. Market News suggests total storage to be between 1.68 and 1.72 TCF. An energy advisor said: "expect inventories to find a seasonal bottom near or above 1.8 TCF in March." The EIA in their STEO this month forecast EOS gas inventories of 1.866 TCF. The Desk last week had a survey estimate of 1.748 TCF. 

On Thursday, the Henry Hub next day cash averaged $3.080/MMBtu, up 10.5 cents from Wednesday, NGI’s MidDay Price Alert showed. The Henry Hub cash held a small premium of about 1 cent to the March NG futures prior to the EIA storage data release. This was up from the more so flat differential between next day cash and spot NG futures seen Wednesday.

Yesterday, the October $8.00 call traded over 2,500 contracts at a price of 3.2 cents. This follows a similar amount in the October $8.00 call that was seen traded Wednesday at a price of 2.7 cents. These were new positions, as per CME open interest data. In the April October 6 month CSO, the -40 cent and -50 cent call open interests rose by 5,000 contracts as they traded in a call spread at a price of 3.6 cents.

Technically, yesterday, the spot NG futures saw their lowest settlement since Thursday, Oct. 16, 2025. April NG futures remain oversold basis the daily chart's momentum. April futures see support at the Wednesday low at 2.867-2.868. This is the top of a gap on the daily chart down to 2.766. Support comes in also at 2.793-2.804. Resistance comes in at 3.060-3.065.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

"Oil prices rose on Thursday, driven by increasing concerns over potential military conflict between the United States and Iran as both countries stepped up military activity in the oil-producing region." (Reuters)

The US said on Wednesday that the two sides were still far apart on some issues after US-Iran talks were held in Geneva on Tuesday. Iran issued a notice to airmen (NOTAM) that it plans rocket launches in areas across its south on Thursday, while the US has deployed warships near Iran. Iran and Russia plan naval drills in the Sea of Oman and Northern Indian Ocean today.  Iran shut down the Strait of Hormuz for a few hours on Tuesday, Iranian state media reported Wednesday, without making clear whether the waterway, one of the world's most vital oil export routes, had fully reopened. (Reuters) The U.S. hasn't assembled so much air power in the region since the 2003 Iraq invasion, on top of which the Navy has 13 ships in the Middle East and the eastern Mediterranean Sea.  (WSJ)


API                Forecast         Actual
Crude Oil   +0.298/+2.7     -0.609
Gasoline      -0.3/-1.2          +3.3
Distillate     -0.9/-1.9           -2.0
Cushing          n/av               +1.4
Runs           +0.2/0.6%          n/av 
The DOE petroleum data will be issued today at Noon (EST).

Energy Market Technicals

ULSD and Brent momentums have turned positive, while that for RB is neutral, and that for the April WTI is trying to turn positive. The Brent DC, April WTI, April ULSD and Gasoil DC charts have all tested their upper bollinger bands today. 

WTI April futures have support at 64.92-64.93 and then at 63.97-64.02. Resistance is seen at 66.73 and then at 67.25. The upper bollinger intersects at 66.27.

 Natural Gas Market Overview

Natural Gas---NG is up 5.1 cents at $3.062
NG spot futures are up slightly --holding over $3.00, after falling Wednesday to a 4 month low. A boost in HDD's in the prior forecast is supporting NG today, as are likely the strength in energies and the TTF contract.  But, the overall tone still is of a warmer weather pattern as we head to the end of winter.

This morning Market News commentary re the weather says :"HDDs now coming within the normal toward the end of the 2-week GFS forecast period for the Lower US 48 states instead of sliding off precipitously in cities like New York and Philadelphia." The market rallied back over $3 in the afternoon Wednesday as a slightly cooler forecast was offered--especially in the 8-14 day outlook, as per Celsius Energy commentary. Although, the Commodity Weather Group on Wednesday said above-normal temperatures are expected across the eastern half of the US through February 22, while mostly normal seasonal weather is expected for the following week.

The EIA gas storage data due out today at its regular hour (10:30 AM EST) is seen as a draw of 149 to 152 BCF as per WSJ & Bloomberg surveys. This compares to last year's draw of 182 BCF and the 5 year average draw of 151 BCF.

The TTF European spot futures have gapped higher today. The increased tension between the US and Iran has lifted the TTF value today, given concerns about LNG shipping in the region. Gas markets are increasingly worried about shipments through the Strait of Hormuz—especially from Qatar, the second-largest exporter globally. News wire accounts though mention some of the TTF upside seen today may be mitigated by a milder weather forecast across Europe and stronger renewable output in Germany. Yet, European storage remains very low. EU gas storage sites were last 32.5 per cent full, compared with 43.3 per cent at the same time last year, Gas Infrastructure Europe data showed. (Reuters/WSJ)  The gap created today goes from 31.980 to 32.100.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Overview

The March/April and April/May Heating Oil spreads saw their values one week ago fall to 1/2 the value they held at the end of January when the February futures contracted expired very strongly.

The spreads may now find some support given that the narrative we saw at the end of January has flipped. At the end of January we mentioned that the strong spot values for ULSD were attracting imports from Europe. Yesterday, we wrote the following: " Diesel shipments from the US to Europe are accelerating in February 2026, with arrivals expected to rise 25% to 366 MBPD, marking the highest level since December 2024. This surge is driven by tighter European regional balances and the reopening of the transatlantic arbitrage. Supply in Europe has tightened following a January 21 deadline that restricted imports of refined products derived from Russian crude."

Geopolitical tension is said to be supporting diesel cracks. This past weekend, Ukraine launched further attacks against Russian refineries. Drones struck the Ilsky oil refinery in southern Russia in recent days. The Ilsky refinery is one of the largest private oil processing facilities in the area.   (Euromaidanpress.com)

The past 2 weeks have seen strong US distillate demand in the DOE data. Last week's demand of 4.449 MMBPD was 764 and 935 MBPD greater than the prior 2 years. Two weeks ago, demand stood at 4.310 MMBPD, which although 289 MBPD less than in 2025 was 493 MBPD greater than seen in 2024.

One possible negative to the US diesel/distillate market may come from the increased purchases of Venezuelan crude that are being touted. The Venezuelan crude being a heavier grade is seen leading to greater distillate yields/volume from US refiners.

Technically the March / April and April / May spreads have positive momentum basis their daily charts. The March April spread has support at 771-772, then at the 715 area. Next support is seen at the 658-667 area. Upside resistance lies at 945-949 and then at 1122-1125.
For the April May spread, support comes in at 330-333 and then at 279-282. Resistance is seen at 456-460 and then at 492-495.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are higher now as the market focuses further on US Iran and Ukraine-Russia conflict talks. Military activity in the Mideast has also underpinned energy prices as has a comment from the US Vice President. Continued risk premium is a theme mentioned in news wire market accounts today.

Vice President Vance said Iran had failed to acknowledge core U.S. demands in talks in Geneva Tuesday, after which Washington said it had agreed to give Tehran two weeks to close the gaps between the sides. (WSJ) He also said that the Iranians are not yet willing to acknowledge some of Trump’s red lines in a Fox News interview.

One analyst cited by WSJ said:" the risk of sudden escalation--given the U.S. buildup of military assets and Iranian threats--is likely to sustain a geopolitical risk premium, currently estimated at $3-$5 per barrel."  The military element underpinning prices consists over the past few days of Iran conducting live fire operations in the Strait of Hormuz, while another U.S. aircraft carrier is expected to join the Abraham Lincoln in the Middle East in late March or April. (WSJ) Iran and Russia will conduct navy drills in the Sea of Oman and the northern Indian Ocean on Thursday, the Iranian semi-official Fars news agency reported. (Reuters)

Keeping a risk premium on prices was the abrupt end of peace talks between Ukraine and Russia in Geneva on Wednesday after only two hours. Ukrainian President Zelenskiy said that the discussions had been difficult and accused Russia of deliberately seeking to delay progress toward a deal to end the four-year-old war. Russia’s chief negotiator said the talks had been difficult but business-like, and that a new round of talks would be held soon. (Reuters)

Tuesday saw energy prices fall off sharply near the 9 AM NY opening as the Iranian Foreign Minister said that Iran and the United States had reached an understanding on the main "guiding principles" in a second round of indirect talks in Geneva over their nuclear dispute on Tuesday, but that does not mean a deal is imminent, he added. (Reuters) After that Reuters  reported the Foreign Minister said that no agreement had been reached, but that the "path has started".

A Reuters analyst has written in detail about Asia's crude imports. Asia's imports of crude oil are on track to hit a record high in February as the recent strong run continues, but the mix of suppliers is starting to shift in response to geopolitical dynamics. Seaborne arrivals are set to rise to 28.51 MMBPD in February; this is up from the 27.48 MMBPD total in December and 26.22 MMBPD in January, according to Kpler data. India's imports in February are seen at a pace of 5.40 MMBPD, up from January's level of 5.18 MMBPD. March crude oil imports into India are seen currently at 4.04 MMBPD. This is due mostly to a large drop in imports from Russia. They are seen running at 593 MBPD, a 59% slump from the 1.43 MMBPD in February and the 1.22 MMBPD in January. The main beneficiary of India moving away from Russia would appear to be fellow OPEC+ member Saudi Arabia, with February imports expected to reach 1.03 MMBPD, up from 774 MBPD in January and the most since November 2019, according to Kpler data. Saudi Arabia's lower OSP incentivized more sales to Asia.  China's imports of Saudi crude are expected to be  1.58 MMBPD in February, up from 1.20 MMBPD in January and the most since June last year. However, China is sticking with Russia as a top supplier, with February seaborne imports expected at 2.02 MMBPD, up from 1.85 MMBPD in January. China's January and February imports from Russia are the highest in Kpler records going back to 2013.

Energy Market Technicals

Technically momentum remains negative for the energies, but the price action continues to show a sideways pattern.

WTI April futures see support at 62.44-62.48 and then at the overnight low at 62.00-62.04. Resistance comes in at 64.29-64.30 and then at 65.60-65.61.

Natural Gas Market Overview

Natural Gas--NG is down 5.2 cents at $2.979
NG spot futures have yet again tested $3 as weak near term weather demand remains in focus, as does strong US gas production, even as feedgas volume has been boosted by Golden Pass' facility.

Short-term weather forecasts show warming trends, but the possibility of a shot of cold weather remains, according to EBW Analytics Group. On Tuesday, the Commodity Weather Group said above-normal temperatures are expected across the eastern half of the US through February 21, while mostly normal seasonal weather is expected across the country through February 28.

The drop in NG futures the past 2 sessions comes even as the Golden Pass LNG plant is ramping up production. Monday's feedgas demand to the plant was 0.35 BCF/d, up from 0.13 BCF/d on Sunday. Celsius Energy says that this ramping up of volume is 2-3 weeks early, which they add is bullish.

BNEF estimates that on Monday, the US Lower 48 states dry gas production stood at 114.25 BCF/d, down from the previous day of 114.85 BCF/d. But, over the weekend, natural gas production nearly topped the December 19th record of over 114.967 BCF/d,  reaching 114.907 BCF/d on Saturday February 14.

TTF spot futures have fallen to their lowest value today since January 12. Milder weather forecasts, including the potential for warmer and windier conditions in the coming days, have offset concerns around low inventories. In addition, slower Asian demand amid ongoing holidays and stronger LNG imports into northwest Europe this month have weighed further on prices. ING adds :" Gas storage levels stood at 33% of capacity as of 16 February, well below the five‑year average of 49% and last year’s level of 44% at this point in the season."

Technically NG momentum looks to be trying to turn upward from oversold condition, even as prices slump today. Support below comes in at 2.893-2.897. Resistance is seen at 3.147-3.149. There is a large gap on the daily March NG chart from 2.854 down to 2.739.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

The energies are lower now as Iran's Foreign Minister said that they have reached an understanding on the main principles with the US. This has seen crude oil fall over one dollar n a short space. Energies had been higher overnight on some concerns revolving around the Straits of Hormuz and Ukraine Russian talks. 

Parts of the Strait of Hormuz will close for a few hours on Tuesday due to 'security precautions' for shipping safety, an Iranian news agency reported, as the Revolutionary Guards conduct military drills in the waterway. (Reuters) Additionally, the UK Navy said that they got a report of an incident near Aden/Yemen. This is near to the Strait that leads to Saudi Arabia and the Red Sea. The report was of a small arms fire exchange between a UK ship and a skiff. (Bloomberg)

Ahead of the Russia-Ukraine talks, Ukrainian attacks on Russian energy infrastructure continue. The Ukrainian military said on Tuesday that it had struck the Ilsky refinery, while a drone attack was also reported at the port of Taman, which is at the head of the Black Sea. And Russian forces pounded Ukrainian power infrastructure before a new round of peace talks. President Zelenskiy condemned the overnight strikes on 12 Ukrainian regions that came under attack hours before the scheduled start of U.S.-backed trilateral talks. (Reuters)

Diesel shipments from the US to Europe are accelerating in February 2026, with arrivals expected to rise 25% to 366 MBPD, marking the highest level since December 2024. This surge is driven by tighter European regional balances and the reopening of the transatlantic arbitrage, supported by improved US refinery utilization and falling freight costs.  Supply in Europe has tightened following a January 21 deadline that restricted imports of refined products derived from Russian crude. The transatlantic ULSD arbitrage, which had previously closed due to cold weather impacting US export availability, has reopened.  Strong diesel cracks and improved refining margins, aided by lower sour crude costs, are encouraging higher US production.  (Quantum Commodities)

A report surfaced in the past days that had Presidents Trump and Netanyahu having agreed at a White House meeting that the U.S. would work to reduce Iran's oil exports to China, Axios reported. China accounts for more than 80% of Iran's oil exports. (Reuters)

India has seized three U.S.-sanctioned oil tankers linked to Iran this month and stepped up surveillance in its maritime zone to curb ‌illicit trade, a source said on Monday. India is aiming to prevent its waters from being used for ship-to-ship transfers that obscure the origin of oil cargoes.  (Reuters)

Many Asian markets were closed on Tuesday for Lunar New Year holidays, including mainland China, Hong Kong, Taiwan, South Korea and Singapore, thus reducing trading volumes. "Thin liquidity due to Lunar New Year holidays has limited broader price moves," ING analysts say.

The WTI/LO March options expire today. The $63 calls had 10,003 contracts open as of Friday's close, while the $65 call strike had 23,779 contracts open. There are no nearby expiring put option strikes with over 10,000 contracts open.

The weekly petroleum data from the API and DOE will be issued a day later than normal this week due to yesterday's President's day holiday. Thus, the API data will be issued Wednesday evening and the DOE data will be released Thursday at Noon (EST).

Energy Market Technicals

Momentums remain negative for the energies, although the price action has a continued sideways pattern.

Spot WTI futures see support at 62.14-62.20 and then at 61.21-61.25. Resistance lies at 64.71-64.74 and then at the DC chart's double top at 66.42-66.48.

Natural Gas Market Overview

Natural Gas--NG is down 16.3 cents ( from Friday's settlement) at $3.080
NG futures are still lower versus Friday's settlement but well off the low seen Sunday evening. Weather forecasts have added back a decent amount of HDD's in the latest runs.

The GFS 6z (US 2 AM time) 15day forecast added 22 HDD nationally driven primarily by early March. But, a weather run from just a few minutes ago (8AM EST) saw some HDD dropped.

The overnight rally comes even as gas inventories are seen rising back to a surplus versus last year's level, and is also seen possibly flipping to a surplus versus the 5 year average. Celsius Energy reports that by the end of the week, the surplus to last year will be in excess of +100 BCF. Last week's EIA data had the deficit to last year at 97 BCF as of February 6th.

Lower 48 states dry gas production is currently estimated 0.47 BCF/d lower today at 114.37 BCF/d; but, that is up from an average of 114.1 BCF/d over the previous week, BNEF shows.

The WSJ had an article mentioning how the updated outlook from the NOAA's Climate Prediction Center forecasts a potential El Nino climate setting in next fall/winter, which could bring a mild winter for much of the U.S., thus limiting demand. "Market participants appear to be hedging some downside risk as they extrapolate that the chances of the weather pattern and its associated mild temperatures materializing should remain high into the winter months," says Gelber & Associates in a note. The NOAA's report gave a 61% for El Nino to set in beginning in September.

The Desk's latest survey of end of March 2026/EOS gas in storage rose by 79 BCF to 1.748 TCF. That compares to the EIA's estimate of 1.866 TCF from this month's STEO. The Desk's survey of the end of October 2026 gas in storage rose by 43 BCF to 3.780 TCF. That compares to the EIA's estimate of 3.988 TCF from this month's STEO.  

This week's EIA gas storage data is seen as a draw of 150 to 154 BCF, as per early estimates. This compares to last year's draw of 182 BCF and the 5 year average draw of 159 BCF.

A colleague pointed put how there are a whole host of open March put options positions. Are these going to act as a magnet for the spot futures in the near term? The NG/LN options expire next Tuesday February 24. The $3.00 strike had 59,774 options open as of Friday's close. The $2.75 puts had 48,027 contracts open. The $3.25 put strike had 27,354 options open.

Technically the NG futures have closed the gap to 3.114 that was created over the weekend. DC chart based momentum is neutral at an oversold level, while the March daily chart has momentum that is near oversold and near turning positive. NG futures have tested resistance at 3.164-3.167 this morning with a high of 3.171. The next best resistance comes in at 3.246-3.249. Support is likely at 3.018-3.020. The low from Sunday evening is 2.968.

The EIA's weekly gas storage report will be released at its normal hour on Thursday at 10:30 AM (EST).

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Energies are mixed with crude & ULSD up slightly, but RB down 0.5 cents. The market is awaiting the next round of US/Iran talks set to begin tomorrow --as are further talks in the Russia/Ukraine conflict. Words being used today to describe the crude oil market are :"little changed"  and "steady". 

Today prices were supported some by news of the Iranian Revolutionary Guard  holding drills in the Straits of Hormuz. (Market News) Iran's Revolutionary Guards have warned that in case of strikes on Iranian territory, they could retaliate against any U.S. military base. The U.S. has dispatched a second aircraft carrier to the region and is preparing for the possibility of a sustained military campaign if the talks do not succeed, U.S. officials have told Reuters.

Iranian ministers told the media over the weekend that the country was ready to compromise on its nuclear program in return for relief from debilitating U.S. sanctions. They also signaled that it was now up to Washington whether it wanted a deal. (Investing.com)

China's Russian oil imports are set to climb for a third straight month to a new record in February after India slashed purchases on the back of U.S. pressure, according to traders and ship-tracking data. (Reuters)

CFTC data seen Friday showed money managers added very little to their net length in crude oil. In WTI, on ICE/CME combined, 7,777 contracts of net length were added in futures/options in the week ended Tuesday Feb. 10. Brent net length rose by only 2,813 contracts, as per ING analysis. RB net length rose by 12,143 contracts, due mostly to short covering. The short covering helped propel RB futures to their high last week. ULSD net length fell by 4,009 contracts in the Friday CFTC report. 

The Baker Hughes oil rig count issued Friday showed a decrease of 3 units.

Today the CME will have shortened trading hours ---closing from 2:30 PM (EST) until 6 PM. Activity in global financial markets is expected to be muted on Monday with China, South Korea and Taiwan closed for Lunar New Year holidays, in addition to Presidents' Day in the United States. In China, the official Lunar New Year celebrations will last from Feb. 15 to Feb 23. 

Energy Market Technicals

While WTI DC chart based momentum is negative, the price pattern for WTI spot futures remains sideways. RB and ULSD momentum are negative. Gasoil has a gap on the DC chart.

WTI spot futures see support at 62.14-62.20 and then at 61.21-61.25. Resistance lies above at 64.71-64.74.

Natural Gas Market Overview

Natural Gas--NG is down 21.8 cents at $3.025
NG futures have gapped lower--testing below $3 in the spot futures--with forecasts of warmer weather in the near future. Strong US gas production is also seen having weighed on prices.

The NOAA has forecast that the next two weeks will bring warmer-than-usual weather for this time of the year to much of the country.

Lower 48 states US dry gas production is currently estimated 1.22 BCF/d lower today at 113.90 BCF/d having risen to a very strong amount of 115.1 BCF/d over the weekend, BNEF data shows.

Money managers in Friday's CFTC report were seen having turned net short in the week ended Tuesday Feb. 10. 8,234 contracts of net shorts were added making the net total short 8,128 contracts.

TTF futures have also gapped lower over the weekend. Falling demand for heating as spring draws near has pressured prices, as has the sharp drop in the NG futures being seen. Yet, as of Friday, the European Union’s gas in storage was at 33.97%, according to Gas Infrastructure Europe, with Germany’s even lower, at just 23.95%, and the Netherlands’ at 15.57%. Analysts forecast that EU gas storage would be only about 26% full by the end of March, when the winter season officially ends. That would be the lowest end of season amount in 4 years and will necessitate substantial imports to replenish storage to the 80-90% target by November that the EU dictates. (Oil Price) The gap created over the weekend in the spot TTF futures goes from 31.340 to 31.575. Currently the spot futures are printing Euro 30.960.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Overview

The May June July 2026 NG butterfly rose yesterday to its best value for the contracts. We believe that some of the strength seen in the wings---May and July--versus the body/June contract was a function of the index fund roll that was ongoing this week. The index fund roll saw March long contracts being sold to be rolled forward into longs in the May contract.

Technically the contract has 2 elements that make us believe that the butterfly is getting toppy. The butterfly settled yesterday/Thursday at 11.2 cents, which was one tic over the daily chart's upper bollinger band, thus creating a mean reversion setup. That band lies today at 11.8 cents, which says that a settlement below that band should see the butterfly lose some ground.
The other technical element we see that suggests that the butterfly has topped out is the momentum indicator is getting overbought and has the look of cresting, thus seems poised to turn downward.
In the prior 2 years, the butterfly peaked at 13.3 and 12.6 cents, but did not reach those highs until close to the expiration of the contract in April. But, given that the current butterfly has made a new high this week, we would peg possible resistance at the prior 2 years highs.
We see support below for the wings versus the June body in the current contract at 8.6/8.8 and then 7.6 cents.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Crude oil prices are slightly higher now after earlier selling off as Reuters today reported that OPEC+ is leaning toward resuming oil output hikes in April, while immediate US Iran concerns have also moderated.

Reuters reported on Friday that OPEC+ is leaning towards resuming increases in oil output from April, citing three OPEC+ sources, as the group prepares for peak summer demand and price strength is bolstered by tensions over U.S.-Iran relations.

Crude oil prices have come under pressure not only from the OPEC+ news seen today, but also from yesterday's announcement from a White House official that the US Treasury will ease some sanctions against Venezuela this week, as well as the IEA reaffirming their bearish view of the oil market.  (Reuters)   "There is an expectation that Venezuelan oil supply will return to pre-blockade levels in the months ahead," one analyst said, adding that supply is expected to rise from 880 MBPD to about 1.2 MMBPD.

The US CPI data showed an increase in January of 0.2%--an increase of 0.3% was forecast ---the year on year inflation rate came in at +2.4%. January's annual inflation rate was down from the December rate of +2.7%. The US dollar sold off on the CPI data and hence crude prices have rebounded some.

Regarding Venezuelan crude oil, exports to Europe have resumed in February 2026 after an 11-month pause, driven by U.S.-supervised sales following the change in administration. Repsol SA and Vitol are receiving shipments as international traders like Vitol and Trafigura market up to 50 MMBBL.  Tankers carrying roughly 1 MMBBL each departed for Spain (Repsol's Cartagena and Bilbao refineries) and Italy (Vitol's Saras complex). Simultaneously, Indian refiner Reliance Industries has restarted purchases, and shipments have increased in January and February 2026. (Quantum Commodities)

In geopolitical news, U.S. media outlets reported late Thursday that the U.S. was sending a second aircraft carrier to the Middle East, which kept investors on edge, according to Reuters reporting.  Away from the Middle East, the Kremlin said on Friday that the next round of peace talks on Ukraine will take place next week. (Reuters)

The WTI futures open interest rose by over 22,000 contracts Thursday even as the spot month March contract saw open interest fall by over 31,000 contracts. We see the increase in open interest being more new short positions opened. Increases were seen all along the curve --with higher open interest from April through June and September through December, as well as in November 2027, December 2027 and January 2028. 

The CME will observe shortened trading hours on Monday in observance of the President's Day holiday in the US. The CME platform will open as usual at 6PM (EST) Sunday evening and remain open until Monday at 2:30 PM. The platform will then be closed until 6PM. It will then remain open until 5 PM Tuesday evening. All trades executed between Sunday evening and Tuesday will be for settlement date Tuesday.

Energy Market Technicals

The April RB has clearly been repelled from values over $2.200 ( in conjunction with the spot contract failing to hold over $2.00) and in so doing April RB's daily chart momentum has turned negative. WTI DC chart based momentum has also turned negative. ULSD momentum remains negative.

WTI spot futures have reverted to the lower end of the recent range seen. Support comes in at 62.03-62.07 and then at 61.21-61.25. Resistance lies at 64.71-64.74 and then at 65.78-65.83.

Natural Gas Market Overview

Natural Gas---NG is down 7.8 cents at $3.139.
NG prices are lower today weighed down by a disappointing EIA gas storage number seen Thursday and the prospect for less heating demand as temperatures are seen warming up next week.

The Commodity Weather Group said Thursday that above-average temperatures were expected across the Midwest and South through February 21. Average Lower 48 states temperatures are forecast to rise above normal over the coming week to a peak around Feb. 18 before dropping to below normal across Feb. 21-26, according to GFS.

The EIA gas storage data seen Thursday came in weaker than forecast with a draw of 249 BCF. This was 9 to 16 BCF less than news wire survey estimates. Total storage fell to 2.214 TCF. This is 97 BCF (-4.20%) versus last year's level and -130 BCF (-5.55%) versus the 5 year average. The coming weeks will see the current deficits in storage reduced versus last year and versus the 5 year average --possibly even return to surpluses. 

Cash prices at Henry Hub averaged $3.425/MMBtu on Thursday, up 18.0 cents, as per NGI’s MidDay Price Alert. But, NGI’s spot natural gas National average price fell by 2.0 cents to $2.955.

Top business leaders urged the European Union on Wednesday to act urgently to bring down energy prices, saying that was key for European industries to be able to compete with the United States and China. The loss of cheap Russian gas imports following Moscow’s 2022 full-scale invasion of Ukraine hiked bills for many energy-intensive industries. Congested power grids, national taxes and the EU’s CO2 emissions price also contribute to power prices – which for industries in Europe are more than double those in the United States and China. The EU’s electricity system is designed so that the last power plant needed to meet total demand sets the power price. Often, that is a natural gas plant – leaving many consumers highly exposed to gas prices, which are significantly higher in Europe than in the U.S.  (Reuters)

The March put options on the CME were active on Thursday. The March $3.20/$3.00 put spread traded 9.6 cents with 0.18 delta March futures bought at $3.23. The March $3.00/$2.75 put spread traded more actively,  with prices ranging from 5.1 to 5.6 cents cost. The March $2.75 put's open interest rose by over 11,000 contracts Thursday. The March April CSO also was active with the plus 25 cent call trading 4.5 cents in what looks to have been a closing of a position. The plus 10 cent/flat put spread in the March April CSO traded 4.8 cents. The $1.00/$2.00 call spread in the March April CSO traded 0.4 cents. The March April futures spread settled Thursday at +13.2 cents.

Technically the March futures have oversold momentum basis the DC chart, while the March daily chart's momentum is getting near oversold. Support for the spot futures is seen at this week's lows at 3.055/3.061. Resistance comes in at 3.280-3.288.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC

Liquidity’s Daily Market Overview

Crude oil prices are lower now after trading higher overnight. The fall back is mostly attributed to the IEA's monthly oil report that continues to stress the fact that there is a large supply / demand imbalance. Prior, overnight prices were supported by the continued concern over US/Iran tension and by the strong NFP data seen yesterday--even as yesterday's DOE data showed a large crude oil build.

The IEA, in today's monthly report, lowered its estimates for this year's growth to 850 MBPD from 930 MBPD previously, as economic uncertainties and higher oil prices weigh on consumption. That compares with demand growth of 770 MBPD last year. The IEA also lowered their supply growth forecast for this year, as a result of the disruptions seen in January due to  the freeze-offs in the US & Canada and the export constraints that curtailed flows from Kazakhstan, Russia and Venezuela.  Non-OPEC+ production in January declined by 1.1 MMBPD. The IEA sees supply growth in 2026 at +2.4 MMBPD, down 100 MBPD from their last forecast. Last year saw supply growth of 3.1 MMBPD. In 2026, the total global oil supply will exceed demand by 3.73 MMBPD, compared to 3.69 MMBPD in the previous report. (WSJ/bitget.com)

With regard to issues in export loadings out of Kazakhstan, ING offers the following report :"Reports suggest that February loadings are expected to come in between 1.15-1.25m b/d, up from 907k b/d in January, but lower than originally expected as production from the Tengiz field recovers gradually. Meanwhile, March loadings are expected to be somewhere between 1.55-1.65m b/d. A recovery in exports from the CPC terminal should help ease some of the tightness we have seen in the oil market so far this year."

The DOE oil data issued Wednesday showed a large build in crude supplies of 8.53 MMBPD. The crude oil build is due to the increase in net crude imports and the rise in US oil production. The net crude imports rose by 912 MBPD ( to 3.066 MMBPD) --as crude imports rose by 604 MBPD and crude exports fell by 308 MBPD. US crude oil production rose on the week by 498 MBPD to a total 13.713 MMBPD. Product demand rose on the week. Distillate demand rose by 139 MBPD to a strong figure of 4.449 MMBPD ---which is much greater than seen the prior 2 years. This week's distillate demand beat last year's by 764 MBPD and 2024's by 935 MBPD. Gasoline demand rose on the week by 147 MBPD to 8.300 MMBPD, lagging last year by 276 MBPD but above 2024 demand by 132 MBPD.

On the supply side, Russia's seaborne oil products exports in January rose by 0.7% from December to 9.12 million metric tons (=66.85 MMBBL or 2.16 MMBPD) on high fuel output and a seasonal drop in domestic demand, data from industry sources and Reuters calculations showed.

Beyond the U.S., focus in the coming days will be on Chinese travel trends during the Lunar New Year holidays, which begin in the coming week. The holiday is usually marked by outsized demand for travel in the country, and portends an increase in fuel consumption. (Investing.com)

The US national retail gasoline price has risen further today to its best price since December 9th. Today's price rose by 0.7 cents from yesterday to $2.944. One month ago, the price was $2.796.

Energy Market Technicals

Technically the crude oils still have positive momentum basis the DC charts. ULSD momentum remains negative, although the DC chart pattern still has a sideways look. April RB momentum is turning neutral, although some resistance may have formed over the past few sessions.

WTI spot futures see support at 63.64-63.65. Resistance comes in at yesterday's high at 65.83. Above that the DC chart double top at 66.42-66.48 is resistance.

Natural Gas Market Overview

Natural Gas--NG is up 11.5 cents at $3.274
NG spot futures are up today, rising into the gap created over the weekend. Prices are being supported by the expectation for a strong draw from gas storage today and by US natural gas  production not returning to pre-storm levels. Strong LNG feedgas demand is likely also supportive.

Today's EIA storage data is seen as a draw of 258 to 264 BCF, as per news wire surveys. This compares to last year's draw of 111 BCF and the 5 year average draw of 146 BCF. The prospect though for the coming weeks data into the end of the month look to be for the deficit to the 5 year average to be reduced. As NGI reports:" Withdrawal pace likely to slow in coming weeks."

Celsius Energy said Wednesday that US natural gas production was 107.4 BCF/d, up "just" 2.0 BCF/d versus a year ago.  Since the storm seen in late January, the production increase versus one year ago has remained well below the increase seen during November and December, when the year over year increase was near or greater than 5.0 BCF/d.

NGI commentary re feed gas demand reads as follows:" Feed gas nominations to U.S. LNG terminals have reportedly swung back with a vengeance, according to pipeline data, indicating exporters could be looking to make up for lost time during the winter storm. Wood Mackenzie estimated nominations could reach 19.3 BCF/d Wednesday and average 18.7 BCF/d in the coming seven days. The firm noted the persistent rise over the past few days “has been driven by the largest feedgas nominations we have ever seen” at East Coast terminals, but cautioned that those numbers could be revised in a later cycle."

On Wednesday, the next day Henry Hub cash gas price managed to regain some value versus the spot March NG futures. The cash premium was seen at about 9 cents mid-morning, up from the flat price differential seen Monday.

In the LN/NG options traded on the CME Wednesday, most prominent to us were trades in the March, May and October months. 7,000 contracts of the March $4/$5 call spread traded 2.7 cents with 0.09 delta March futures sales at $3.16. The March $4 strike saw the position being opened, while the $5.00 call position was being closed. Further in the March options, the $3.50/$3.75 call spread traded with the $2.75 put being also sold at a net cost of 0.6 cents with 0.2 delta March futures sales at $3.16. In the May options, in an opening of the position, the $4.00 call traded 9.0 cents with 0.18 delta May futures sales at $3.09. In the October options, the $3.00/$2.25 put spread traded 17.5 cents with additional sales of the $5.00 call at 15.5 cents for a net cost of 2.0 cents.  

Technically, the NG futures have a double bottom from the prior 2 sessions at 3.055/3.061. We see support above that possible at 3.147-3.155. Resistance lies at 3.326-3.328 and then at the filling of the gap from the weekend up at 3.387.

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Disclaimer

This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.

Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC