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- Daily Energy Market Update 6-30-2025
WTI is down 18 cents August RB is unchanged August ULSD is up 1.83 cents
Liquidity’s Daily Market Overview
Energies are mixed with crude oil, RB unchanged, but ULSD higher. The crude price is being weighed down by the prospect for another OPEC+ oil production increase to be seen in August. Tariff concerns may also be weighing on oil prices.
Four OPEC+ sources told Reuters last week that the group was set to boost production by 411 MBPD in August after similar increases for May, June and July. OPEC+ is set to meet on July 6.
President Donald Trump's 90-day pause on higher tariff rates is set to end July 9th. President Donald Trump says he's not planning to extend a 90-day pause on tariffs on most nations beyond July 9. Trade deals have not been reached with major trade partners like the European Union, Japan, and Canada, as of this writing. Agreements with as many as a dozen of the U.S.’ largest trading partners are expected to be completed by the July 9 deadline, top Trump advisers said this week. But if Trump’s only two other accords, with China and the U.K., offer any indication, the pacts likely won’t be fulsome deals that resolve core issues but rather frameworks for negotiations that will address a limited set of topics and leave many specifics to be negotiated later. (Bloomberg)
The Chinese official PMI data for June saw a slight rise to 49.7 from May's level of 49.5. That figure was in line with analysts’ forecasts in a Reuters poll. The new export orders component of the manufacturing PMI improved significantly to 47.5 from 44.7 in the prior month. That could signal a rebound in demand from U.S. buyers following the trade truce reached by Beijing and Washington in mid-May, as per one analyst cited by the CNBC article. Non Manufacturing PMI also rose in June from May, from 50.3 to 50.5. (CNBC)
The Baker Hughes oil rig count saw a decline of 6 units in Friday's report. The oil rig count drop is not as significant as the number might suggest as Wyoming saw a drop of 5 rigs. The major US shale basins saw only a total of 2 rigs dropped --and only 1 of those was in the Permian basin. The total oil rig count is at the lowest level since October 2021.
The CFTC COT report showed money managers reduced their net length in WTI, but raised it in RB and ULSD in the week ended Tuesday June 24. WTI net length fell by 14,882 contracts total combined between ICE and the CME. RB net length rose by 2,864 contracts and that for ULSD rose by 14,547 contracts. Bloomberg reports that the ULSD net-long position was the most bullish in more than 18 months. Brent saw the net long positioning slashed by 29% or over 80,000 contracts, to 192,600 contracts. (Saxo.com)
Near term crude oil options skews have remained stable with second month near parity after pulling back from a strong call skew seen during the recent Israel-Iran conflict. Crude second month at-the-money implied volatility is back to early June levels at 31.5% for Brent and 35.3% for WTI. (Bloomberg)
Today is the last trading day for the July RB & ULSD and the August Brent futures contracts.
Markets in the U.S. this week will see shortened trading hours due to Friday's July 4th holiday. The CME will see the market open Thursday at 6 PM EDT as per usual. But, the CME's Globex platform will close Friday at 1 PM EDT. The U.S. stock market will close Thursday at 1 PM and stay closed Friday.
Energy Market Technicals
As one analyst noted :" The market is back to a range-trading environment". This is evident in the sideways trading seen in WTI over the past 4 sessions. Will that continue to be the case given the trading hours this week will be shortened due to the Friday July 4th holiday and the market may be awaiting the outcome of the July 6th OPEC+ meeting?
August WTI sees support at 2 of the past 4 lows at 64.50-64.51 and then at 63.96-64.00. Resistance lies at 66.42 and then at 67.83.
August ULSD support and resistance looks to be framed by the highs and lows of the past 5 sessions. Support is seen at 2.2191-2.2223, which are the lows of Friday and today. Below that support is seen at 2.2014. Resistance lies at 2.2997-2.3020 and then at 2.3234.
August RB support comes in at 2.0410-2.0429 and then at 2.0290-2.0300. Resistance lies at 2.1083-2.1098.
Natural Gas Market Overview
Natural Gas --NG is down 15.7 cents
NG futures are lower today after Friday's strong rally, as the weather does not seem hot enough to cause a major surge in demand like that seen this past week. Gas production remains strong.
LSEG said average gas output in the Lower 48 U.S. states rose to 105.6 BCF/d so far in June, up from 105.2 BCF/d in May. Back on June 10, LSEG had June output averaging 105.0 BCF/d.
Although above-normal temperatures are expected across the Lower 48 states through at least July 12, meteorologists say a return to last week’s peak heat is unlikely. (tradingview.com)
Total feedgas flow to US LNG export terminals are estimated down 0.501 BCF/d to 14.75 BCF/d today, Bloomberg shows, after rising to the highest since May 11 yesterday.
Friday's sharp rally looks to have been a function to some degree of short covering, given August open interest on the CME saw a decline of over 11,000 contracts as the contract became the spot futures.
The fall today in NG prices comes even as this week's storage build is seen shrinking the 5 year deficit after 10 weeks of larger-than-usual net injections. Early estimates seen for this week's EIA number are calling for a build of 49 to 53 BCF. The 5 year average build is 61 BCF.
CFTC data seen Friday showed money managers covered a very small amount of their net short position in the week ended Tuesday June 24. Buying of longs saw the net short total fall by 2,536 contracts to 60,725 contracts.
The Baker Hughes gas rig count saw a decline of 2 units in Friday's report.
TTF European futures prices have fallen today to their lowest spot price value since May 5th as Mideast tensions have eased. Today's fall comes after last week's most significant weekly decline in nearly two years. Prices fell by roughly 20% last week and have fallen 7 days in a row now. (Bloomberg) Also weighing on prices is a strong LNG import volume. They are currently running 41% above the five-year seasonal average, according to analysts at ANZ Research. (investing.com) European storage levels are healthy—57% full compared to an average of 66%. (WSJ). The pullback in futures prices comes even as much of Europe is in the midst of a strong heat wave. In the European natural gas market, money managers flipped to 18% net shorts from 9% net longs as of last Tuesday, according to data from Bridgeton Research Group LLC. (Bloomberg)
As per Reuters, some analysts have started to say the natural gas futures market may have already seen its highest price for the summer when it hit $4.15 on June 20 in anticipation of last week's heat wave. Technically today's NG futures prices are showing an inside day versus the price range seen Friday. Momentum basis the DC chart is trying to turn positive. Support for August futures is seen at 3.513-3.515 and then at 3.453-3.454. Resistance lies at 3.680-3.685 via the August 60 minute chart. Above that resistance is seen at 3.751-3.760.
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Disclaimer
This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.
Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC
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