Daily Energy Market Update March 27,2026

Liquidity’s Daily Market Overview

Energies are higher amid continued concerns for energy infrastructure and hence supply from the Mideast, even as President Trump extended his deadline for attacking Iran's power plants.

While Trump extended to ​April 6 his deadline for Iran to reopen the Strait of Hormuz or face the ​destruction of its energy infrastructure, the U.S. has also sent thousands of troops to the Middle East, with ‌Trump ⁠weighing whether to use ground forces to seize Iran's strategic oil hub of Kharg Island. The Pentagon is considering sending up to 10,000 additional ground troops to the Middle East, The Wall Street Journal reported overnight, citing officials. (WSJ/Reuters) An Iranian official told Reuters that a 15-point U.S. proposal, conveyed to Tehran by Pakistan, was "one-sided and unfair". (Reuters)

Kuwaiti authorities on Friday confirmed its Shuwaikh and Mubarak Al-Kabeer ports were damaged in a suspected Iranian drone attack. The Kuwait Port Authority said the attacks caused "material damage".  (Quantum Commodities) Shuwaikh Port is Kuwait's primary maritime trade hub, handling cargo storage, distribution and commercial shipping. These ports are not the ones from which Kuwait ships its crude exports. Kuwait's crude oil production has fallen to 500 MBPD from 2.6 MMBPD, due to the closure of the Strait of Hormuz.  It could take 3 to 4 months to restore full production capacity once the security situation stabilizes. (aa.com.tr)

Shipping activity through the Strait of Hormuz has picked up in recent days, lending some support to claims by President Trump that Iran has allowed 10 oil tankers to pass as part of ongoing negotiations. Looking at the past several days, Morgan Stanley estimates that as many as 12 vessels have passed through the Strait since March 23. That marks a clear increase compared with the prior four-day period from March 19 to 22, when only three vessels were recorded.(Investing.com)

Singapore refined product inventories rose sharply by 2.2 MMBBL week on week to 52 MMBBL, which is the highest level since December 2024 – led by builds in middle distillates (diesel/Gasoil/jet fuel)  of +1.23 MMBBL and light distillates (gasoline/naphta) of +0.5 MMBBL. (ING)  Singapore is poised to import an unprecedented volume of refined products in March, highlighting the country's importance as a key oil trading hub, as per WSJ commentary. Suppliers and traders are responding to supply concerns by diversifying their sources and bringing in cargoes into Singapore's vast storage in anticipation of a spike in demand from affected buyers in the region, market sources said. The import surge into Singapore is likely to carry its momentum into April, WSJ commentary adds.

The damaged Ust‑Luga terminal may force Russian refineries to cut runs, sources say. The closure of Russia’s Baltic port of Ust‑Luga following a drone attack on Wednesday could force major refineries in ‌the European part of the country to cut crude runs due to shipping constraints, two Reuters market sources said. 4 refineries with a capacity of 400 MBPD could be affected.

Energy Market Technicals

Momentum remains negative for the energies. WTI spot futures show higher lows having been posted all this week, even as news wire commentary touts the fact that the contract is poised for the first weekly decline since the Iran conflict began 4 weeks ago. Reuters says t is the first weekly decline since February 9.

WTI spot futures have support at 93.90-93.97 and then at the overnight low at 92.08-92.10. Resistance is seen at 98.75-98.78 and then at 99.78.

Natural Gas Market Overview

Natural Gas--May NG is up 9.4 cents at $3.022
NG futures are higher boosted by the bullish EIA storage data seen yesterday and the ongoing supply concerns raised by the Iran conflict. Additionally a tropical cyclone disrupting Australian supply is supportive.

Yesterday's EIA gas storage data was bullish with a draw of 54 BCF, which was more than any forecasted number we saw. This is the presumed last withdrawal for the season. Total storage fell to 1.829 TCF. This is +14 BCF / +0.77% versus the 5 year average. The total is +90 BCF/+5.18% versus last year's level.

For the LNG market, supply risks have intensified after a tropical cyclone forced production cuts at three Australian LNG plants, together accounting for around 8% of global supply. (ING) All major LNG export terminals in Western Australia have halted operations and cleared all vessels from their berths as the cyclone intensifies, according to Kpler.  Woodside Energy has fully demobilized its offshore platforms and floating production units. This is in addition to the shutdown of Qatar’s largest liquefaction facility. One analyst said that between the disruption from Qatar and now the cyclone hitting Australia, more than a quarter of global LNG supply was currently affected. This will exacerbate gas market tightness in Asia and Europe, especially if it takes more than a matter ​of days to normalise Australian production levels again," he added. (Reuters)

Yet, Thursday, TotalEnergies’ CEO said  that his firm will honor all LNG contracts in volume and price despite the Qatar outages, per Reuters. Total’s portfolio is large enough to meet all contracted volumes despite the shortage of gas coming out of the Middle East.

Japan's industry ministry will relax ‌rules for one year to increase the use of coal-fired power plants in the fiscal year starting April, given the sharp increase in the price of LNG due to the Iran war. LNG consumption could then fall by about 0.5 million tons a year, or slightly more than 10% of the LNG it imports ​via the Strait of Hormuz, according to a METI's estimate. Japan takes delivery of some 4 million ​metric tons of LNG annually - or around 6% of its total imports - via the Strait of ​Hormuz. "This is strictly a ‌short-term adjustment ⁠and does not alter our long-term decarbonization policy," a Japanese ministry official said. Japan has been restarting nuclear power plants to assist with power generation. (Reuters)

Yesterday's options activity saw the October January -$2.50/ -$2.00 put spread trade 8,000 contracts worth at 8.6 cents. CME open interest data shows the -$2.50 put being a new position versus the closing of the -$2.00 puts. Also in the October January CSO, the -75 /-50 cent calls spread traded 1.8 cents 2,000 lots worth. The -75 cent call was an opening position, as per CME data. The -75 cent call also traded 2.7 cents cost against 0.1 delta buys of the January versus selling October at a differential of $1.685. In the October November CSO, the -40/-50 cent put spread traded 3.0 cents 3,000 lots worth. The -40 cent option trade was an opening position. 6,000 contracts of the September October flat call option traded 2.2 cents---with much of that trade being an opening position.

Today is the last trading session for the April NG futures.

Technically, the May NG futures have momentum that looks poised to turn positive basis the daily chart. Resistance lies at 3.090-3.096 and then at 3.134-3.136. Support comes in at 2.934-2.936 and then at 2.891-2.893.

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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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