Good Morning!
The API data rose 2.9 million barrels as the street was looking for less of a build. The data was not a shocker to our in-house Energy Analyst at Price Group Phil Flynn, who was looking for a 3.2 million build.
This is still in line with expectations but the negativity investors had in the market was the signing of Executive Orders to revive the Dakota Access and Keystone XL pipelines. Even with OPEC talking further production cuts market overreacted to American production all of the sudden booming. Number one these Executive Orders will be fought tooth and nail by the Environmental Production Agency (EPA) and the Sierra Club just to name a couple environmental outlets. The market still has bullish chatter especially in the short term with the work to complete the project and make it safe is still a ways away. The positive spin is moving product by pipeline rather than rail is more economic, safer and will create U.S. jobs. In the overnight electronic session the March Crude Oil is currently trading at 5271 which is 47 points lower. The trading range has been 5309 to 5257. The EIA Energy Stocks will be released at 9:30 A.M. central.
On the Corn front Informa Economics lowered U.S. Soybean Planted Acreage forecast to 88.647 million from previous 88,862 while Informa raised Corn Planted Acreage to 90,489 million from previous 90,151 million acres. This further set the tone of a selloff after the Grain complex rallied last week due to floods and rains in the Argentine Soybean growing areas. In the overnight electronic session the March Corn is currently trading at 363 which is ¼ of a cent lower. The trading range has been 363 ¼ to 361.
On the Ethanol front there were no trades posted in the overnight electronic session. The February contract settled at 1.461 and is currently showing 6 bids @ 1.446 and 1 offer @ 1.464 with dwindling Open Interest at 1,293 contracts. The March contract settled at 1.489 and is currently showing 1 bid @ 1.476 and 1 offer @ 1.488 and growing Open Interest at 2,867 contracts.
On the Natural Gas front the March contract is currently trading at 3.300, which is ½ of a cent higher. The trading range has been 3.329 to 3.276. The market will be gauging three things, the weather will experience in the couple weeks (will forecasters be correct on how cold it will get), Tomorrow's EIA Gas Storage and Friday’s Baker Hughes Rig Counts.
Have a Great Trading Day