The February WTI (CLG25) trading session settled at 70.99 (+0.39) [+0.55%], a high of 71.56, a low of 70.12. Cash price is at 70.59 (+0.91), while open interest for CLG25 is at 340,806. CLG25 settled above its 5 day (69.55), above its 20 day (68.92), above its 50 day (69.10), above its 100 day (69.72), below its 200 day (72.77) and below its year-to-date (72.54) moving averages.
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This morning Reuters announced, citing unnamed trade sources, that the Chinese Ministry of Commerce is looking to allow independent refineries to receive 152.49 million metric tons of crude import quotes for next year. Reuters estimates that this would add to a total increase of about 3.17 million barrels per day. Last week China announced they would issue 3 trillion yuan ($411 billion) in special treasury bonds in 2025. Tomorrow new factory data from China will be released. The Shanghai based CSI 300 Index closed higher by 0.45%.
In a story published by CNN this morning, GasBuddy, which has accurately predicted average national gas prices over the past few years, is forecasting prices to fall ~11 cents nationally, from $3.33 this year to $3.22 a gallon in 2025. GasBuddy’s De Haan also estimated that if Trump’s proposed 25% tariffs are put on Canada and Mexico it could raise the retail price of gas between 30 to 70 cents a gallon.
New weekly API data will be released tomorrow while EIA weekly data will be released Thursday.
Price Thoughts – I believe crude oil ended the last week higher based on the S/D situation and new stimulus announcements out of China. Last week we saw the 4th consecutive week of draws in U.S. crude inventories. Also factoring in the price changes for energy markets today is the updated weather forecast for January, which is now predicting a noteworthy cold front adjustment to sweep through North America, in my opinion. WTI has continued to test its upward resistance level of $72.50 which has held since October, maybe by week’s end we’ll see it break through with continued bullish momentum. To WTI’s downside, $65 has been a major support point, which I expect to hold through the first quarter of next year. I would not be surprised to see sideways thinner-than-normal trading during this holiday week.
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Jim Rinaudo
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