The following table compares my projections for this week's report (for the categories I am making projections) with the change in inventories for the same period last year. As you can see from the table last year for the same week the inventory changes are mostly in directional sync with the projections for this report. As such if the actual data is in line with the projections there will be only modest changes in the year over year comparisons for most everything in the complex except for crude oil inventories.
Even though WTI is still trading above its technical support level of around $104/bbl the market may be still in a medium term downside correction as the immediate tensions with Iran seem to be easing a tad. As such I am maintaining my view at neutral for the moment while I sit back and see how the market digests the economic news hitting the media airwaves. Even as the market seems to be in the midst of a sentiment adjustment oil continues to be driven by the evolving geopolitics of the Mideast...in particular Iran with just about all of the other normal prices drivers taking a secondary role...including fundamentals.
I am still keeping my view at neutral and bias at bearish. My overall view remains biased to the bearish side. The surplus is still building in inventory versus both last year and the five year average is going to get harder and harder to work off with only weeks until the start of spring. As such for the short to medium term I doubt Nat Gas is going to reverse the downtrend it has been in for an extended period of time. We may certainly see times when short covering rallies take hold but I do not expect a sustained trend change.
Currently markets are mostly lower as shown in the table below.
Dominick A. Chirichella