Daily Energy Market Update December 18,2025

Liquidity’s Daily Market Overview

The energies are mixed at present --with the RB and crude oil higher, while the distillates are lower. Notable is the fact that the energies are well off their overnight highs, after making marginally better highs today versus yesterday's highs. The energies have fallen back as news wire stories mention how the curtailment of Venezuelan export flows would not be substantive enough to rectify the oversupply being seen. Prices have been supported the past 24 hours by worries over a US blockade of Venezuela and the possibility for further sanctions against Russia.

On Wednesday, Bloomberg reported that the U.S. is preparing another round of sanctions on Russia's energy sector in the event Moscow does not agree to a peace deal with Ukraine, although President Trump is said to have not made a decision yet. The European Union on Thursday imposed sanctions on 41 more ships in Russia's shadow fleet, taking the total of designated vessels to almost 600. (Reuters0

Russian President Vladimir Putin warned Wednesday that Moscow will seek to extend its gains in Ukraine if Kyiv and its Western allies reject the Kremlin's demands in peace talks. Speaking to defense ministry staff, Putin said Russia would continue its operation "by military means." Putin referred to European leaders as "piglets" during the Defense Ministry meeting.  (Fox News/AP)

The Venezuelan Navy is said to have escorted several ships carrying oil products overnight Tuesday, the New York Times reported. One investor said :"“Reaction has been muted, with the market viewing the impact at roughly 500,000 barrels a day — insufficient to shift the oversupply narrative.”  (Bloomberg) Much is being made in the newswires that the drop in Venezuelan oil exports would mostly affect China, as they are the main buyers of said oil.  Venezuela may have to start to shut-in some oil wells due to low storage capacity as maximum capacity could be reached in about 10 days, Bloomberg sources said.

The DOE data seen Wednesday was not totally transparent with the crude inventories falling by 1.274 MMBBL, but the EIA's accounting adjustment added 859 MBPD of supply equal to 6.0 MMBBL. Refinery runs rose by 128 MBPD to 16.988 MMBPD. Net crude imports fell by 719 MBPD. US crude oil production fell on the week by 10 MBPD. Thus, those 3 items indicate that crude oil supply fell by 5.999 MMBBL on the week. Gasoline demand rose on the week by 622 MBPD to a healthy 9.078 MMBPD, beating the prior 2 year's demand by 151 and 324 MBPD. But, the demand increase was not enough to keep gasoline supplies from rising by 4.808 MMBBL, more than was forecast. Distillate demand

Bridgeton Research Group, which was acquired by Kpler this week, said Wednesday: “While the market rallied earlier in the morning, CTAs will need further validation of the price move before adjusting their stop-loss limit orders,”. The Research Group said that trend following commodity advisers remained 100% short Brent and WTI. (Bloomberg)

The retail gasoline price has fallen to a fresh low for recent data. The AAA says today's US price at the pump is $2.896.

Energy Market Technicals

Momentum basis the February daily charts for the energies has turned positive off of the oversold conditions seen a few days ago.

February WTI sees support at the low of Tuesday at 54.89. The lower bollinger band lies at 55.54. Resistance is seen at 57.44-57.46 and then at 58.01-58.05.

Natural Gas Market Overview

Natural Gas--NG is up 12.0 cents at $4.144
NG futures are continuing the rally seen yesterday. Some short covering is in effect. Also supportive is the colder forecast seen. Also, today's EIA gas storage data is seen reducing the surplus to the 5 year average.

Forecaster Atmospheric G2 said Wednesday that forecasts shifted colder in the East and not as warm in the southern states for December 27-31. (Barchart)

The WSJ survey estimate for the EIA gas storage number due out today is calling for a draw of 169 BCF. Last year saw a draw of 131 BCF and the 5 year average draw is 96 BCF.

Open interest data from the CME for Wednesday's trading in NG futures showed a decrease of 19,290 contracts. Short covering we believe was at work with declines in the January, March, April, October and November contracts.

Norwegian pipeline gas nominations to Europe are currently at around 347 million cubic meters (mcm) per day marking their highest level since August 2024, data from infrastructure operator Gassco showed. The weather forecast for Europe shows chilly temperatures for Christmas and the days after, as per Celsius Energy reporting. ING reports that the latest positioning data continues to indicate that speculators are increasingly bearish on the European gas market. Investment funds sold a further 7.9TWh in TTF over the last reporting week, leaving them with a net short of 92.8TWh. This is the largest net short since early 2020.

Today, in the TTF options on the CME the April through September Euro 20 puts traded Euro 2.00 with 0.40 delta futures buys at Euro 25.825. In the TTF options on the CME Wednesday, the Euro 23 and 29 puts were purchased against selling of 3 of the Euro 26 puts. The wing buyer paid .475 Euros. The trade included .20 delta February TTF futures sold at Euro 27.10. Today, the February TTF futures are trading 27.02 Euro/Mwh. Also seen on the CME in TTF options trades Wednesday, the April through September strip's Euro 30 call was bought at a cost of 1.35 Euro with 0.29 delta futures sales in the strip at Euro 26.00. That strip settled between 25.73 and 26.13 Euros on Wednesday.

In the LN/NG options trading seen Wednesday, the March April 2026 CSO 10 cent call was sold versus buying of the flat call in some volume; the call spread traded 2.0 cents. The 10 cent March April call was also bought versus selling of the 25 cent call at a cost of 1.0 cents. The March April 2026 futures spread settled Wednesday at +1.7 cents. The April $3.00 and $4.00 call open interest rose quite a bit. Both of those options were a part of a butterfly trade. The $3.00/$4.00/$5.00 April call butterfly traded 26.7 cents. Additionally, the April $4.00 call was sold two times versus buying of one $3.25 call, with the trade going 8.7 cents. The April futures settled Wednesday at $3.316. The January $3.25 put open interest rose by 4,698 contracts Wednesday as per CME data. One trade seen in that option was the January $3.50/$3.25 put spread that went 0.75 cents. The March April 2027 spread's minus 10 cent put traded 1.8 cents. The March April 2027 futures spread settled Wednesday at 31.2 cents. The February $6.00 call open interest on the CME rose by 3,357 contracts; the February $6.00/$7.00 call spread traded 2.2 cents. The January February CSO 25/40/50 cent call butterfly traded in size at a cost of 2.5 cents to the buyer of the wings. The January February 50 cent call also traded in volume, as it was sold versus buying of the 35 cent call in a trade that cost 1.5 cents. And the 50 cent call was bought against selling of the $1.00 call in the January February CSO; the spread traded 1.0 cents. The January February futures spread settled Wednesday at 25.0 cents.

Momentum for the NG futures has turned positive from an oversold condition. Resistance for the January futures comes in at 4.257-4.259 and then at 4.319-4.321. Support comes in at the overnight low at 4.050-4.052 and then at 3.913-3.920.

Enjoyed this article?

Subscribe to never miss an issue. Liquidity’s Daily Energy Market Updates provide a comprehensive analysis of both the fundamentals and technical factors driving energy markets.

Click below to view our other newsletters on our website:

Ethanol Update 

Natural Gas Update

Fuel and Freight Daily Report

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