CQG News | Market Summary: October 10, 2021
Summary
No imminent release from the US Strategic Petroleum Reserve as falsely rumored earlier in the week, more switching to petroleum for power generation as Natural Gas prices continue to increase at record rates particularly in Europe, OPEC+ maintaining restraint in sticking to its current output, the ongoing easing of Covid-19 restrictions thus facilitating demand and US Crude production still below Hurricane Ida levels all contributed to price increases this week. A slowing rise in employment numbers and the growing likelihood of rate increases by the Federal Reserve limited equity index gains. A number of analysts surmise that the implied threat of demand destruction linked to Crude prices exceeding $80 per barrel is diminishing as inflation continues to run at 30-year highs. Stronger refinery utilization rates as well as a 99 KBPD rise in the flow of imports of Gasoline which largely target the Atlantic coast were among the reasons for the sharp increase. A disciplined result of the OPEC meeting, severe Natural Gas shortages and the approach of winter in the northern hemisphere should all lead to increased petroleum prices in the upcoming week.
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