Written Commentary
CRUDE OIL
August Crude Oil gapped lower early Friday and fell to its lowest level since April 22 following President Trump’s claim that a deal with Iran that would open the Strait of Hormuz as soon as this weekend. Iranian media reported Foreign Ministry spokesperson Esmaeil Baghaei as saying large parts of the agreement have been finalized, but Iran would not compromise on its red lines. Some have speculated that the deal is a 60-day ceasefire extension. This comes after Trump cancelled threatened strikes on Iran on Thursday and also after increased hostilities between the two nations this week that offered only limited support to crude oil. OPEC on Thursday lowered its forecast for world oil demand growth in 2026 to 970,000 barrels per day, the second straight downward revision and down from 1.17 million barrels per day seen previously.
PRODUCTS
July RBOB was lower early Friday in line with crude oil, but it did not give back as much ground. We are entering the key driving season, and US gasoline supplies are the lowest they have been for this point in the season in at least six years. July ULSD gapped lower and fell to its lowest level since May 6.
NATURAL GAS
July Natural Gas fell to its lowest level since May 27 on Friday, extending Thursday’s lower move off a bearish US storage report. The 6-10- and 8-14-day maps look a bit cooler in some parts of the nation today, with below normal temps persisting from the Midwest to the north Atlantic. However, above normal temps expanded out west. Overall the forecast is mixed, but it does not present the sort of wide-ranging heat event that would spark above-normal cooling demand. Thursday’s weekly EIA gas storage report was bearish against expectations.
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