Daily Energy Market Update December 5,2025

Liquidity’s Daily Market Overview

WTI and RB are down slightly, while HO is up over 4 cents, lifted by renewed Ukraine attacks on Russian energy infrastructure. News wire commentary regarding crude prices is terming the market as steady and stable. The stalled Ukraine peace process and a possible Fed interest rate cut are supportive, offset by "expectations of a supply glut".

Ukrainian drones struck the Syzran oil refinery in Russia’s Samara region – one of the largest in the Rosneft network – early Friday. This is the fourth known attack on the facility, following strikes in 2024 and February 2025. The refinery was previously hit in August, temporarily halting operations. Rosneft operates the refinery. In a related overnight operation, Ukrainian drones also hit the port of Temryuk in Russia’s Krasnodar region. Temryuk handles liquefied petroleum gas (LPG), oil products and petrochemicals (Kyiv Post/Reuters)

Of economists surveyed in a November 28 to December 4 Reuters poll, 82% expected a 25-basis-point interest rate reduction at next week's Federal Reserve policy meeting.

Asian buyers, primarily from South Korea, Japan, and Thailand, recently purchased about 8 MMBBL of U.S. crude (like WTI, Eagle Ford) for January 2026 loading, driven by shifting global supply dynamics and sanctions on Russia/Iran, with major South Korean refiners (SK Energy, GS Caltex, Hyundai Oilbank) taking significant volumes. This reflects increasing Asian reliance on U.S. oil as they seek alternatives to sanctioned suppliers, boosting U.S. exports to the region. (Quantum Commodities)

Saudi Arabia lowered its OSP to Asia for January loadings for its flagship A-Light crude grade by 40 cents --as expected. The premium to the Oman/Dubai average has thus been reduced to 60 cents, which is the lowest premium in 5 years. The OSP for January loadings to Asia of the Heavy and Medium grades were lowered by 60 cents. These cuts were a bit more than the Reuters forecast for a cut of 40 to 50 cents for those heaver grades. The OSP price cuts were seen tracking the decline in spot benchmark prices. Prices to NW Europe and the Mediterranean were lowered by $1.30. The prices to the US were cut by 70 to 90 cents. Cash Dubai's premium to swaps averaged 90 cents per barrel in November, down 32 cents from October. (Reuters)

The retail gasoline price continues to slide. Today the AAA says the US national average is $2.978. One month ago the price was $3.079 and one year ago it was $3.032. By contrast, the diesel average price today is $3.717, up from the price one year ago of $3.536 and the price of $3.705 one month ago.

Energy Market Technicals

Momentum for the HO basis the DC chart has turned positive from an oversold condition, after falling yesterday to a 6 week low. WTI momentum is positive, while that for RB remains negative, although it is oversold.

WTI sees resistance at the highs from yesterday/Monday at 59.97/60.02 basis the Dc chart. Above that resistance lies at 60.44-60.48. Support comes in at 58.27-58.28.

Natural Gas Market Overview

Natural Gas--NG is up 17.9 cents at $5.242
NG futures continue their march higher as the prospect for cold weather outweighs the somewhat disappointing EIA data seen Thursday. The prospect is for the next 3 weeks EIA data to show bullish draws near 150 BCF.

One comment re the upcoming weather says : "Highs will continue to come in well below the average for this time of year through the 10 day forecast."  In New England, extreme cold so far this week caused next-day gas prices to soar to $25 per mmBtu, their highest since February 2023. (Reuters)

Financial firm LSEG said average gas output in the Lower 48 states slid to 109.4 BCF/d so far in December, down from a monthly record high of 109.6 BCF/d in November. On a daily basis, output was on track to drop by about 3.1 BCF/d to a three-week low of 108.2 BCF/d on Thursday. (Reuters)

On Thursday, LSEG projected average gas demand in the Lower 48 states, including exports, would fall from 144.5 BCF/d this week to 142.6 BCF/d next week. These forecasts are up a total of 5.4 BCF/d from those seen Monday.

Average gas flows to the eight large liquefied natural gas (LNG) export plants operating in the U.S. have dropped to 18.0 BCF/d so far this month, down from a monthly record high of 18.2 BCF/d in November. (Reuters)

The EIA gas storage data issued Thursday showed a draw of 12 BCF, which was 2 to 6 BCF less than news wire survey forecasts. NG futures fell to the low of the session of $4.871 on the storage data news, only to rally back over $5 in the afternoon as the market continues to imply good weather demand. Total gas storage fell in this week's data to 3.923 TCF. Total storage remained 191 BCF/5.12% over the 5 year average. Inventories were -18 BCF/-0.46% versus last year's level with this week's data. Notable was the increase in the South Central region's inventories. They rose by 16 BCF. As one colleague said: "Next week's data will be interesting to see how much gets pulled across the board." Next week's data should see a draw from the South Central region--given the large demand that is implied in the region's OFO's that we highlighted a few days ago. Also, the strong rise of 20 to 30 cents in the next day Hub cash price over the past week implies a greater possibility for a draw from the South Central region.

Celsius Energy commentary seen Thursday mentioned how the GWDD total for the day was "easily" the highest for the past 5 years at over 40 GWDD, beating last year's amount of 30.1 GWDD, which Celsius added was already a very strong number in and of itself. Celsius added : " GWDDs will dip over the next 3 days before spiking again next week with the next wave of arctic air."

Today starts the double index fund roll which should see some selling of the spot January futures against buying of March contracts (the 3rd month).

Analysis seen Thursday further amplifies the discussion of European/TTF vs US/NG pricing. The TTF forward curve is trending towards long-term US LNG export costs, but may need to fall towards the parity with Henry Hub to lead to US cargo cancellations, according to one analyst.  The current TTF forward curve for European gas during 2025 to 2030 is in a range with prices of around $10/MMBtu down to $8/MMBtu at the end of the period, declining in line with expectations of greater supply, mainly from the US and Qatar.  The forward curve is now reasonably close to long-term US export plant costs (estimated at 115% of Henry Hub plus $3.50 for plant cost and shipping).  Thus, if a global supply wave of LNG reaches the market in 2027/28 faster than demand can absorb it, the forward curve could drop to equalize with Henry Hub in order to cancel US cargoes. But, the analyst notes however that there could be a lot of demand waiting at levels only slightly lower than today’s prices. (Market News) Reuters quotes one researcher re the narrowing NG/TTF margin as follows:  "Many U.S. LNG export contracts will be out of the money if the Henry Hub-TTF spread drops below $4 per mmbtu. And if margins fall below $2, representing LNG production costs, operators will almost certainly have to reduce production."

Bloomberg reports that LNG on tankers that have not unloaded for at least 20 days increased 40% week on week to 4.67 million tons as of Nov. 30. The total has risen to the highest since November 2024 having surged from a low of 2.18 million tons on Nov. 8 and now at the high end of the previous seasonal five-year range. Profits for resellers of LNG have gotten squeezed as the NG price has risen over $5 while the Asian JKM marker languishes near $11.00. The same narrative is playing out with the NG price rising, while today the TTF marker fell to a fresh low since April 8,2024. The TTF spot futures low today of 26.80 Euro/Mwh equates to $9.15 /MMBtu. 

NG/LN CSO options traded actively Thursday. The April/October 6 month CSO traded with the -25 cent call being bought against which the -10 cent call and -50 cent put were sold, with the -25 cent call buyer collecting 3.1 cents. The January February CSO 10 cent puts traded 0.7 cents. The January February 10 cent put was sold against buying of the 25 cent put at a price of 4.0 cents. The February March $1.00 calls traded 15.7 cents. The February March 50 cent/35 cent put spread went in a 1 by 2 ratio, with the 50 cent put buyer collecting 0.6 cents.

NG futures spread also traded actively on the CME block board. The January April spread traded 8,500 contracts in total at 3 different prices: $1.03, $1.08 and $1.10. The spread settled Thursday at $1.113. 3,000 contracts of the April August of 2027 spread traded 26.5 cents; the spread settled Thursday at 26.1 cents.

Technically the NG spot futures continue to rise along the DC chart's upper bollinger band, with Thursday seeing yet another mean reversion setup, having settled over the band. The band lies at $5.140, which is where we see near term support, from lows on the January daily chart from May and June of this year. Resistance comes in at 5.341 from the high on the January chart from June. Above that the DC chart data from Nov./Dec. 2022 shows resistance at 5.367-5.375 and then at 5.556-5.565. Momentum is overbought basis the DC chart.

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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