Written Commentary
CRUDE OIL
June Crude Oil is higher this morning, near the upper end of Friday’s range, before it sold off on the news the Strait had opened. Iran closed the Strait of Hormuz again over the weekend after the US did not lift its blockade of Iranian ships. Reuters said shipping data indicated that traffic through the Strait remained at a standstill on Monday with just three crossings in 12 hours. The US also seized and Iranian cargo ship that attempted to break through the blockade. At this point, both sides seem far apart on restarting the peace talks in Pakistan, with Iran saying it will not participate. On Friday the Trump administration renewed the waivers on Russian oil for another month. The Baker Hughes rig count showed US oil rigs in operation were down 1 to 410 last week. This was down from 480 rigs a year ago and below the five-year average of 493.
PRODUCTS
Product prices were higher early Monday off the news that the Strait of Hormuz was “closed” again.
NATURAL GAS
June Natural Gas extended last week’s recovery rally overnight to reach its highest level in a week. Last week the market fell to its lowest level since November 2024 on warm weather, a faster than normal build in US supply, and higher US production driven in part by higher crude oil output. The market also closed higher on Thursday despite a larger than expected injection into in US gas supply in the weekly EIA storage report. The report showed storage was +6.7% from a year ago and +4.7% above the five-year average as of April 10. After a warmup this week, a cooler trend is showing up in the forecast for the nation’s mid-section, may allow a some late-season boost in heating demand and slow the build in supply. The 6-10 and 8-14 day maps show below normal temperatures extending down from the Northern Plains and extending south into Texas westward to Nevada and eastward to the Midwest and eventually the mid-Atlantic region. The Baker Hughes rig count showed US natural gas rigs in operation were down 2 rigs to 125 last week
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