Written Commentary
Wkly Futures Market Summary For 2.10.2025
February 10, 2025
CRUDE OIL
October Crude Oil was lower overnight following yesterday’s rally to the highest level since July 19, but the market held in the upper end of yesterday’s range. In its monthly report today, IEA kept the 2024 global demand growth forecast unchanged, but it trimmed the 2025 growth forecast to 950,000 barrels per day from 980,000 previously, citing a weakened Chinese economy. Yesterday, OPEC cut its 2024 demand growth forecast to 2.11 million barrels per day from 2.25 million previously, also citing slower growth in China. This has helped offset anxiety over the anticipated retaliation by Iran against Israel for the recent killing of a Hamas leader in Tehran and the potential impact on supply if the Mideast war between Israel and Hamas widens into a regional conflict. The market will be looking to US PPI report today and CPI tomorrow for their implications for upcoming Fed policy. The trade is expecting the Fed to cut rates in September. For the US inventory reports this week, a Reuters poll of trader expectations shows crude stocks -2.0 million barrels last week, with gasoline -1.1 million and distillates -1.8 million. Refinery utilization is expected to be up 0.7% from 90.5% last week.
PRODUCT MARKETS
The IEA report did say this summer’s US driving season is expected to be the strongest since the pandemic.
NATURAL GAS
September Natural Gas was moderately higher overnight and was approaching yesterday’s three-week high. One theme emerging from the reduced expectations for Chinese oil demand is that natural gas consumption is growing as that nation make a move to “greener” energy sources. World Weather Service expects warming to occur in the central US this week and that warmer than normal temperatures and higher than usual cooling fuel demand will be most common through the next two weeks. The NWS 6-10 and 8-14-day forecasts show a pocket of near to below normal temperatures in the Midwest, Great Lakes, and middle Atlantic regions and along the west coast. The rest of the nation has above normal temps. Prices eased in Europe today, as flows from Russia to Europe via Ukraine appeared to be stable after yesterday’s concerns about damage to infrastructure in the wake of Ukrainian advances into Russia. For the EIA storage report this week, a Reuters poll has expectations ranging from -3 bcf to +26.
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