Daily Energy Market Update March 6,2026

Liquidity’s Daily Market Overview

The Iran war continues to put a strain on crude supplies and as a result is to impact refined fuel product supply. The markets are not seeing any easing of the problems surrounding crude oil flows out of the Mideast. Dubai and Oman crude prices for May delivery rose to $100 for the first time since 2022 as sour crude oil has been impacted the most by the disruptions in the Gulf.

Headlines from this morning: Kuwait Cuts Oil Production at Some Fields as Storage Fills Up -- WSJ. Saudi Arabia, U.A.E. Also Nearing Limits of Storage Facilities -- WSJ.  Restarting production can take days or even weeks depending on the reservoir. Storage is limited in the Middle East.

Qatar's energy minister told the Financial Times he expects all Gulf energy producers to ⁠shut down exports within weeks, a move he said could drive oil to $150 a barrel, according to an interview published on Friday. The Qatari minister also said that even if the war were to end immediately it would his country weeks to months to return to " a normal cycle of deliveries".

Sour crude prices have risen to fresh premiums versus sweeter crude grades. The Gulf disruptions has seen US Mars crude prices surge to multi-year highs. Mars crude is a high density, sour crude grade. (Quantum Commodities)

President Trump told Reuters in an exclusive interview on Thursday that he was ‌not ⁠concerned about rising U.S. gasoline prices linked to the conflict, saying "if they rise, they rise" and that the U.S. military operation was his priority.

The US has cleared the way for India to temporarily increase its purchases of Russian oil. A license issued late on Thursday covers transactions related to Russian crude oil and petroleum products loaded onto vessels before March 5, so long as it’s delivered to India and purchased by an Indian firm. The measure expires April 4 at 12:01 a.m. Washington time.  The US Treasury Secretary said :" “This deliberately short-term measure will not provide significant financial benefit to the Russian government as it only authorizes transactions involving oil already stranded at sea.”   Over 22 MMBBL of Russian crude are unsold or in idle tankers in Asia, with over 80% of the ships near India’s waters and in the Singapore Strait, according to ship-tracking data compiled by Bloomberg. Out of the roughly 5 MMBPD that India imports, just a fifth came from Russia in February, according to Kpler. ING commentary says that allowing India to buy Russian oil will ease some pressure off the market in the immediate, but the Strait of Hormuz remaining closed with the 20 MMBPD that transits there daily means that India's purchasing is not a "game changer" for the market. (Bloomberg)

China is in talks with Iran to allow safe passage for crude oil and Qatari liquefied natural gas vessels through the Strait of Hormuz. China sources about 45% of its oil from the Strait. Ship-tracking data showed that a vessel called the Iron Maiden passed through the Strait overnight Wednesday after changing its signaling to "China-owner. Crude tanker transits through the strait fell to four vessels on March 1, the day after hostilities broke out, versus an average of 24 a day since January, according to Vortexa vessel-tracking data. Around 300 oil tankers remain inside the Strait, according to Vortexa and ship tracker Kpler.  (Reuters)

On Thursday, Saudi Arabia announced its OSP's for April loadings, raising prices to all regions by a large amount, which is in step with the increase in Oman/Dubai premiums. The A-Light OSP to Asia rose by $2.50 from a $0 price in March. Medium and Heavy crudes to Asia were raised by $2.00.  Prices to NW Europe were raised by $3.50 across the board. The A-Light price to the Med was raised by $2.50, while all other grades were raised by $2.00.

Asian refining margins have surged to their highest since 2022 as Iranian threats to shipping through the Strait of Hormuz have disrupted crude oil flows and forced refineries to cut ‌runs, according to data and analysts. Singapore's complex refining margins , a proxy for Asia refining profitability, jumped to nearly $30 a barrel on Wednesday. Jet fuel and diesel led the surge in margins among products in Asia. The margin for the aviation fuel breached $52 a barrel on Wednesday to its highest since June 2022, more than double from Friday, LSEG data showed. Asian refiners, particularly state-held majors heavily dependent on Middle East oil supply, are considering slashing crude run rates by up to 30%. Cracks for 10ppm sulphur gasoil jumped to just above $48 a barrel, the highest since August 2022.   (Reuters/Oil Price) Tankers loaded from India destined for Europe have been diverting towards the East as Asia supplies deplete and refiners look to capitalize on firm Asian margins, according to  ship-tracking data from Kpler. (Quantum Commodities)

The retail fuel prices in the US have risen further today. Gasoline at the pump is up 6.9 cents from yesterday. Today's price is $3.320; one week ago the price was $2.982. The diesel pump price is up 16.4 cents today to $4.330. One week ago the price was $3.757. Commentary from Yahoo Finance citing analysts reads as follows:" Analysts say diesel markets are highly global and especially sensitive to shipping risks and maritime disruptions." GasBuddy commented: "With elevated tension in a key global shipping corridor, diesel is reacting more aggressively than gasoline." Diesel faces the most acute physical pressure in the near term, Kpler analysts say. The limited near-term alternatives makes the diesel supply risk even more acute than the risks for crude oil, jet fuel, and LNG. (Oil Price)

The energy market shrugged off today's US Non Farm Payroll data for February, which disappointed. February saw 92,000 jobs were lost. Consensus forecasts were for February to add 50,000 to 65,000 jobs. The revisions to January and December jobs data showed a further drop of 69,000 jobs from the prior data. 

Energy Market Technicals

The energies are overbought basis their stochastic and RSI momentum indicators. The energies continue to test their DC chart upper bollinger bands.

WTI spot futures have risen today to test some highs seen from April 2024 at 87.63-87.67. Further resistance above lies at 89.79-89.94 and then at 93.64-93.74. Support is possible at 83.53 and then at 81.15-81.18 from April 60 minute data.

Natural Gas Market Overview

Natural Gas--NG is up 12.6 cents at $3.129
NG futures are higher today, boosted by a supportive EIA storage number yesterday and an increase in NG power burn demand. A boost in some heating demand in the back end of the weather forecast is likely also supportive.

After a period of above normal temperatures in much of the US in the 6-10 day forecast, the 8 to 14 day period shows temperatures falling below normal in much of the eastern half of the US. (NOAA)

The EIA gas storage data issued Thursday was slightly bullish as the draw of 132 BCF beat news wire forecasts by 7 BCF. A rebound in NG power burns for heating demand was seen as a catalyst for the better EIA number. Total storage fell to 1.886 TCF, which is -43 BCF (-2.23%) versus the 5 year average, but +115 BCF (+6.49%) versus last year's storage level.

This latest week is also seen having had stronger gas power burns as a percentage of the total fuel demand. Celsius Energy says that the natural gas powerburn has averaged 36.9% of the powerstack. This is up +2.1% vs the same week last year, the most of any fuel component. This is a change from the past 6-12 months when the gas share often lagged the most of any fuel, Celsius adds.

In the LN/NG options on Thursday, the October November minus 15 cent call was sold against buying of the minus 50 cent put. The cost to the buyer was 1 and 2 cents. These were new positions as per CME open interest data. The October November futures spread settled minus 29.9 cents. 2,000 contracts of the January $10 calls traded 19.25 cents. The November $4 call was sold against buying of the December $5 call at a cots of 1.75 cents. With the call spread, there were delta futures trades as well with 0.43 delta November futures bought at $3.86 and 0.53 delta December futures sold at $4.58.

Notable from Thursday's settlements in NG futures was the strength in the December through February strip. Those contracts settled higher by 19.5 to 24.3 cents, while the spot April futures rose by (only) 8.6 cents. NGI commentary suggests that LNG demand possible next winter may have sparked the settlement increases.

Technically the NG spot futures remain in the range seen the past 2 1/2 weeks. Momentum remains positive basis the DC NG chart. Resistance  at 3.130-3.135 has been tested today with a high of 3.143. Next resistance above is seen at 3.188-3.190. Support lies at 2.973-2.975 and then at 2.910-2.912.

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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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