Global equities added value over the last twenty four hours. The EMI Global Equity Index gained 0.36% sending the year to data gain to 2.9% or near the highest level of the year. Global equities are trading as if a deal will be reached in the U.S. before hitting the debt ceiling deadline on Thursday. Equities have been a positive price driver for the oil complex.
This morning API and Genscape will release their weekly inventory data. The API data is a full complement of fundamental data while Genscape will be releasing its Cushing oil inventory report. I am expecting Cushing stocks to show a modest build for the first week after thirteen weeks of declines in inventory. I am also expecting total crude oil stocks to increase with refined product inventories declining modestly.
I am maintaining my oil view and bias at neutral as the Iranian talks get underway and a potential U.S. deal appears to be close. The actions in Libya last week are also a reminder to oil market participants that other geopolitical risk still exists in addition to Iran.
I am maintaining my Nat Gas view at neutral and keeping my bias to cautiously bullish as the market sentiment seems to be changing once again. The fundamental picture could also once again shift as the temperatures across the U.S. start to return to more normal levels.
Markets are mixed heading into the U.S. trading session as shown in the following table.
Dominick A. Chirichella