Market Struggling to Find Direction

On November 20, 2013 by TradingDesk

Tuesday was a busy day for energy futures, with early morning selling reversed course suddenly mid-day after the Total refinery in Antwerp – Europe’s 2nd largest – reported a deadly explosion. By the end of the trading session however, the selling returned to refined products and Brent crude, while WTI held on to fractional gains. The uptick in volatility is consistent with a market struggling to find direction.

Overnight trading has been a mixed back, with Brent and RBOB futures selling off, aided by news that Libya had reopened an oilfield – although more than 1 million barrels/day of export volume remains offline – and as the Saudi Oil Minister said that the market was “well balanced” and they saw no need to cut back production to combat surging production in the US. ULSD futures have held on to slight gains after the API reported a 4.9 million barrel draw in distillate stocks last night, and WTI is flat.

Although the DOE report today will be watched closely for an update on tight PADD1 stocks, US crude production, and refined product exports, the main story of the day is expected to be the release of the minutes from the last FED meeting, as analysts and traders search for the first hint of an end to the monetary easing that has fueled equity and commodity markets for the past 4 years.

Both refined product contracts are stuck in the middle of their trading ranges, and charts are offering little in the way of direction, so expect the volatile trading to continue in the near term.

CLICK HERE for a PDF of today’s chart

Market Update

Comments are closed.