Daily Energy Market Update February 27,2026

Liquidity’s Daily Market Overview

Energies are higher as reports have surfaced of US and Chinese government agencies suggesting/authorizing citizens leave the Mideast region.

Overnight the US government authorized he departure of some embassy personnel and their families from Israel, due to safety risks. This was seen in an embassy post on "X".  Also today adding to the underlying tension felt in the region, China warned citizens to evacuate from Iran "as soon as possible", as per a Chinese state agency report.  (Reuters)

Thursday saw volatile trading in energies as headlines boosted prices after the 9 AM NY opening. Key to the rise in prices were news reports suggesting the US might seek a hardline approach to their talks with Iran. Reports were of the US seeking to have 3 major nuke facilities in Iran dismantled and all uranium returned to the US. These possible proposals were seen being rejected by Iran. Iran’s state media reported that Tehran won’t allow enriched uranium to leave the country, as per Bloomberg reporting. Towards the end of the trading session, energy prices fell off as Omani mediators said that "significant progress" had been made in the US-Iran talks. The Iranian Foreign minister also described the talks as having made progress.  This news came even as reports surfaced that US envoys Witkoff and Kushner were "disappointed wit morning talks with Iran."   The next round of talks at a technical level is expected next week.  (Bloomberg)

Additionally adding to some of the underlying tension re the Mideast situation was a news report Thursday that the US navy was reducing personnel in Bahrain to "mission critical". The last time such a notice was issued was before the June attacks by the US on Iran. (Fox News)

OPEC+ has a meeting set for Sunday, at which they may raise production for April by 137 MBPD. The increase would bring an end to a three-month pause in production increases. (Reuters)

Russia is likely to cut oil exports from western ports by 10% in March from February to 1.8 MMBPD, Reuters sources say. Oil loadings are expected to fall at Primorsk, Ust-Luga and Novorossiysk ports in March amid Western sanctions that are reducing Asian demand for Urals and complicating access to tanker capacity. Ice conditions have gotten worse, causing shipping routes to lengthen. February loadings saw a 9% decline in volumes from January to approximately 2.0 MMBPD from January's rate of 2.2 MMBPD.

The weakness we highlighted yesterday in the N. Sea crude market is reflected in the settlement in the spot Brent futures spread seen Thursday. The April May spread fell by 25 cents and settled at negative 9 cents. The spread has weakened further today. At 7 AM (EST), the spread was printing down 17 cents at minus 26 cents.

Crude inventories in EU-16 countries fell for the second straight month in January, OilX data showed Friday. Stockpiles were seen at a 7 month low.  (Quantum Commodities) Yet, production at Kazakhstan's largest oilfield has recovered to near full capacity after a transformer fire knocked out power supply on 18 January. (Quantum Commodities)

Mexico's crude exports dropped to a fresh multi-decade low in January. This prospect was highlighted weeks ago as the Mexican government seeks to increase their refinery utilization, thus exporting less crude oil. We wish to add that Mexico's crude exports may be lessened as the US imports more Venezuelan crude oil. The flagship Mexican Maya crude and Venezuelan crude oil are both heavy, sour crude grades, that are crucial for complex U.S. Gulf Coast refineries. (S&P Global)

A Bloomberg survey is calling for the Saudi OSP to Asia for April loadings to be hiked by 80 cents. That is after the March OSP was lowered last month by 30 cents to a Flat value versus the Oman/Dubai average. The March OSP was the 4th straight month of a decline in the price, signaling weak demand and high supply.

Supply risks from ongoing geopolitical tensions have prompted analysts to raise their oil price forecasts for the year, despite concerns that an oversupply will continue to weigh on the market, as per this month's Reuters survey. The 2026 Brent oil price forecast was raised from last month by $1.83 to $63.85. The 2026 WTI prices forecast was raised by $1.66 to $60.38. The analysts surveyed put the current risk premium in oil prices at $4 to $10.

Today is the last trading day for the March RB & ULSD futures, as well as the April Brent futures.

Energy Market Technicals

Natural Gas Market Overview

Natural Gas-- NG is up 4.9 cents at $2.876
NG spot futures are higher today with the latest GFS runs and ECMWF agreeing that March 13-14 could see the HDD count reversing and trending upward back to normal levels.

Thursday's weaker settlement for the April futures was seen as a function of the overall warmer weather being forecasted and the EIA gas storage data showing a very low draw versus the average for the period.

The EIA gas storage data issued Thursday showed a draw of 52 BCF, which was 1 to 3 BCF less than news wire survey forecasts. Total storage fell to 2.018 TCF. This saw the deficit to last year's inventories turn to a surplus of 141 BCF (+7.51%) . The deficit to the 5 year average shrank to 7 BCF (-0.35%). Celsius Energy sees the storage report as somewhat bullish : "  On a temperature-adjusted basis, the withdrawal actually averaged 0.8 BCF/day tight, or bullish, versus the 5-year average, the tightest so far in 2026, likely due to stronger LNG export demand, weaker imports, and a pullback in production." They see the slightly bearish report as being totally due to "unseasonably mild temperatures". 

Celsius Energy reported yesterday that real-time gas storage inventories had fallen below 1.9 TCF. They then posed the question as to whether inventories would fall below 1.8 TCF--they are not sure. Given that they see the next 3 weeks gas storage data drawing a total of 65 BCF, the answer to that question looks to be "no".

Notable options activity in LN/NG trading seen Thursday occurred in the April $2.75/$2.50 put spread. The spread was bought for a cost of 3.4 and 3.6 cents with 0.12 delta futures buys at $2.79. The April $2.70/$2.50 put spread traded in a 1 by 2 ratios for a net cost of 1.7 cents. The June $2.75 put was sold against buying of 2 times as many $2.50 puts for a net cost of 0.5 cents. The June options were opening of new positions.

Technically, yesterday's settlement for the spot futures was the lowest seen since September 22. The DC chart gap to 2.895 from the March expiration was almost filled today with a current high of 2.894. Resistance above that comes in at 2.930-2.934 and then at 3.000-3.006. Support is seen at April lows from this week. Support is likely at 2.818-2.826, which are 3 of the past 4 lows. Support below that is likely at yesterday's low of 2.775. Momentum is neutral.  

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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