Last night’s API weekly inventory data showed a draw of 3.9 million barrels and news of threats of a strike for oil and gas workers in Norway and ongoing strikes in Kuwait and France have demand fears in the market again. Also thrown in the mix was the crippling in supplies with the Canadian wild fires and Venezuela not producing or exporting close to what it is capable of has the risk play on for supplies. The Eurozone could play a role in demand destruction as Brexit has global attention but at the moment with all of the negotiations going on and rumors, the destruction card is off for now. The U.S. dollar is trading lower versus the British pound and euro and the stock market is in rally mode after the surprise vote on the referendum for the U.K. to leave buried 2016 gains until yesterday’s spike. In the overnight electronic session the August crude oil is currently trading at 4818, which is 33 points higher. The trading range has been 4858 to4798 so far. This morning the weekly EIA Energy stocks should confirm the API draw.
On the Natural Gas front we are flirting with $3 as the market continues to roll with the August contract currently trading at 2920, which is 3 cents higher. The trading range has been 2.936 to 2.865. This market is positioning to propel to historical highs. Wednesday’s EIA Gas Storage and Friday’s rig counts should add more bullish news.
On the corn front the market sold off and settled lower in Thursday’s trading session and the soybeans could not keep the market higher in sympathy. The weather market we are trading is now positioning for Wednesday's Grain Stocks and Planted Acreage data released at 11:00 A.M. In the overnight electronic session the July Corn is currently trading at 382 ½, which is 2 ¾ cents lower. The trading range has been 3876 ¼ to 381 so far. Expect choppy trade in today’s trading session.
On the ethanol front the activity was as quiet as a church mouse. The July contract settled at 1.608 and is currently showing 1 bid @ 1.591 and 1 offer @ 1.626. This market is driven by corn and crude oil prices and the divergence in this morning’s prices has the market directionless.