Daily Energy Market Update July 30,2025

Liquidity’s Daily Market Overview

Profit taking from Tuesday's sharp rally in energies and a slightly bearish API report weighed on energy prices earlier this morning. Tweets today from President Trump see him reaffirming his August 1 deadline for tariff deals, thus providing a negative tinge to energy prices. But, economic data seen this morning from the U.S. has likely supported energy prices.

President Trump on Wednesday said his reciprocal tariff deadline for remaining trade partners will not be extended this Friday August 1rst. (Reuters) Trump said India would face 25% levies and would be penalized for buying Russian energy as part of a tariff package that will kick in on Aug. 1. (WSJ)

WTI may have been helped a little while ago by a better than expected ADP employment report . July is said to have seen 104,000 new jobs added. Bloomberg's estimate was for a +76,000 number.

The 2nd quarter U.S. GDP figure issued today showed the economy grew by an annualized rate of 3.0%. The estimate was for a rise in GDP of 2.3 to 2.6% for the second quarter.

API                 Forecast         Actual
Crude Oil     -1.3/-1.97       +1.539
Gasoline      -0.6/-0.973     -1.739
Distillate      -0.1/+0.3        +4.189
Cushing          +0.5              +0.465
Runs            Unch/-0.3%       n/av
The rise in distillate supplies has seen the HO front month spread fall to a 5 week low.

Tuesday's rally to 5 week highs for RB & crude oil were seen mostly due to the threat of a 10 day deadline by President Trump for Russia to agree to a ceasefire in the Ukraine war. The 10 day deadline was not new, but the market rallied on that prospect and what that would mean for supply loses of Russian oil, especially to India and China. JP Morgan analysts wrote that while China was unlikely to comply with U.S. sanctions, India has signaled it would do so, which could affect 2.3 MMBPD of Russian oil exports. Trump had said on Tuesday that he would start imposing measures on Russia, such as secondary tariffs of 100% on trading partners, if it did not make progress on ending the war within 10 to 12 days, moving up from an earlier 50-day deadline. (Reuters)

Energy Market Technicals

Momentum remains positive for the Rb & crude oil, but negative for the ULSD.

Technically WTI spot futures have a mean reversion from Tuesday's close over the DC chart's upper bollinger band. That band lies at 69.50 and is currently being tested again. There is currently a double top on the spot WTI chart from yesterday/today at 69.76-69.79. Above that resistance is seen at 70.54-70.60. Support lies at the overnight low at 68.45-68.52 and than at 67.65-67.70.

Natural Gas Market Overview

Natural Gas- NG is down 8.8 cents
September NG  is lower now after rallying overnight as the prospect of continued strong natural gas production and some curtailment of Sabine LNG feed gas flow for LNG export are seen capping the upside. The rally seen yesterday and overnight are said to have been due to the expectation for  a "gradual warm-up" next week. The better forecast looking forward is seen having sparked short covering. Some quantify the rally as having been due to a technical bounce.

NatGasWeather sees the following weather outlook:" "a hotter than normal pattern is expected to return over most of the U.S. for the 2nd week of August with highs of upper 80s to 100s, and where the weather pattern returns bullish." Forecaster Vaisala on Tuesday said that above-normal temperatures are forecast for the West and the East for the August 8-12 period, which will boost natural gas demand from electricity providers. (Barchart)

Total feedgas flows to US LNG export terminals are today estimated at 14.85 BCF/d, as Sabine has reduced its volume by nearly 0.5 BCF/d. Feedgas volume was at 15.04 BCF/d on Monday. 

The EIA released the Annual Energy Outlook 2025 on Tuesday. In it, they project LNG exports rising to 27 BCF/d by 2037. They see 5 projects under construction entering service by 2028, making up 60% of the 2037 expected total. they see LNG exports remaining flat from the mid-2030's until 2050. But the EIA adds that "production in regions closest to the Gulf Coast decreases over the projection period." The mention that NG production in the Permian basin will fall as crude oil production there is seen falling. The Haynesville basin will see production declines as drilling costs there are more expensive. The EIA projects higher Gulf Coast NG prices, that will drive production increases in the Eastern portion of the U.S. to send gas southward. In the AEO2025 Reference case, the Henry Hub natural gas spot price increases to $4.80 in 2050, denominated in 2024 dollars, compared with $2.19 in 2024. In 2024, natural gas prices averaged $0.75/MMBtu more on the Gulf Coast than in the East region, indicating that resources in the East are more economical to produce even when including the costs to transport natural gas to consumers in Texas and Louisiana on the Gulf Coast.

The rally in gas futures came even as the forecasts we see for the EIA gas storage data to be released tomorrow are bearish versus the 5 year average. Gas storage is seen building by 39 to 48 BCF. The 5 year average build is 24 BCF.

The momentum basis the DC chart is trying to turn positive with the turn now to September as the spot futures. Resistance for the September futures lies at the past 3 sessions' highs for September at 3.186-3.192. Support lies at the low seen for the August contract 2 days ago at 2.984. There is a major low from the September daily chart just below that at 2.970 from November of 2024.

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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.

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