Are you going to get blasted? As America gets ready to celebrate the legacy of Martin Luther King Jr. and the inauguration of President J, Trump, most of America will get blasted! Of course I mean the potential for a dangerous arctic blast that is already driving the energy markets as they try to assess the risks of what will most likely be record breaking demand for heating fuels and also the potential risks of weather-related shortages.
How cold will it be and will it impact you? Fox Weather says that, ‘There’s no escaping this’. The FOX Forecast Center said temperatures will plummet as much as 45 degrees below average in spots, leading to below-zero temperatures across at least 20 states, from the Plains to the Great Lakes and interior Northeast. The potentially life-threatening cold is due to a disrupted polar vortex.
The FOX Forecast Center said a lobe of the polar vortex will dip to the south and move into the U.S. this weekend and into next week. “These are the types of weather systems that even bring cold air to Florida,” Merwin said. “You know, there’s only maybe one or two times a year where we get a chunk of arctic air that really invades the country and gets all the way down to the Gulf Coast. This is one of those. So, if you’re a snowbird, you like to escape down to the South – there’s no escaping this. Everyone will feel it.”
Everyone will also feel the pain of higher heating bills. Not only are prices going higher but the amount you use in the month of January may be the most you have used since the 1970s.
Yet one place you might not get blasted is in the Red Sea. Why? The Trump Peace dividend. Trump’s warning to Hamas saying that there will be ‘hell to pay’ if Israeli hostages are not released by the time he returns to office on Jan. 20. Now it is reported at the Yemen-based Houthis signaled a pause in their months-long attacks on commercial ships following a ceasefire deal between Israel and Hamas. Thanks President Trump! Welcome back to the White House.
Still sanctions on Russia are causing tightness of supply in Europe, India and China as they scramble for supply. Biden has sanctions on 155 tankers active in the Russia crude trade.
Elizabeth MacDonald, host of the Evening Edit on the Fox Business Network, reported that, “LA firefighters are still battling an out of control an exceedingly dangerous, fire that broke out yesterday in Monterey County California at a lithium-ion battery storage facility needed for green technology, one of the largest lithium battery storage plants in the world. Evacuations ordered due to heavy, toxic metal smoke is pouring through the area.
Against this backdrop that crude oil setup looks very strong. As the February contract goes off the board, it’s very likely that the March contract will trade above $80.00 a barrel very shortly.
Natural gas has the potential to make an explosive move over the weekend. One of the things that we’ve seen ahead of these polar vortexes is that the market spikes up high when it reopens on Sunday night and backs off. We would expect this pattern to happen again assuming that the weather forecast does not change to warmer.
Yet as I have said before the key for the natural gas market may not be this polar vortex but what comes in February. If we are colder in February, the natural gas has only begun to get moving.