Is It "Trade Optimism," Or Is It "Turkey" Driving Energy Futures
Energy futures are moving higher to start Tuesday’s session, with trade optimism once again taking credit for the early buying, with most contracts hovering near the top of their fall trading range heading into the busiest travel day of the year for the US.
Based on the back and forth action of the past 2 months, we need to see ULSD futures break above $2, and RBOB get above $1.70 before getting too excited over this latest round of buying. That said, with many traders already thinking more about travel and turkey, there could be an outsized move if that technical break happens with light volume this week.
The forward curve charts below show that through the ups and downs over the past 2 months, the forward curves for the big 4 petroleum contracts have not made much of a change, another data point that we’re in a wait and see market for the time being.
A Reuters report Monday provided the most damning evidence yet of Iranian involvement in the September attacks on Saudi oil assets. While this article is stoking fears of further violence in the region, it’s worth noting with the overnight headlines below as examples, Reuters articles are a dime a dozen these days and seem to carry less weight than they once did.
Misleading headlines: Which one is it? See Top Stories Image Below