Written Commentary
CRUDE OIL
With another new high for the move early today, the trend in the August crude oil contract remains up especially given an extension of global economic optimism. Apparently current supply and demand conditions have allowed Saudi Arabia to raise their August crude oil prices into Asia by one full dollar and that suggests demand is strong! It should also be noted that term structure pricing in Brent crude oil futures remains bullish and expectations of continued contraction in North American supply remains in a front and center position.
NATURAL GAS
With the US temperature forecast dramatically expanding the above normal temperature area to further to the west and north, a huge psychological lift from a buyout in the natural gas transportation storage space and a supportive weekly US injection reading from last week the range up extension this morning is not that surprising. The weekly natural gas storage report showed an injection of only 65 bcf. Total storage stands at 3077 bcf or 17.8% above the 5 year average. Over the last four weeks natural gas storage has increased 363 bcf.
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