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How the Recent Natural Gas Surge Boosts Crude Prices

By:
Sébastien Bischeri
Published: Oct 4, 2021, 16:13 UTC

This could be an interesting week for both energy commodity markets!

How the Recent Natural Gas Surge Boosts Crude Prices

In this article:

Market Analysis

While most of the UK fuel crisis is resolved, the British government suggested that the military truck drivers will be helping out to facilitate the arrival of fuel to the South-East region, including London, where shortages still remain to be fixed around the capital.

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(Source: Matt Cartoons)

As I already mentioned in a number of previous editions of our Oil Trading Alerts, we are still witnessing a very particular phenomenon of gas demand shifting to oil demand, as crude is nowadays relatively more competitive. Thus, this switch in energy demand could come in the following forms:

  1. From a slowdown in electricity production in Asia.
  2. From a hedging effect in the anticipation of a colder than normal winter in the northern hemisphere.

OPEC+ members are meeting today and, therefore, might increase their production a little more than expected to rebalance supply. So, would it help the black gold to make a new dip?

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Figure 1 – WTI Crude Oil (CLX21) Futures (November contract, daily chart, logarithmic scale)

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Figure 2 – Henry Hub Natural Gas (NGX21) Futures (November contract, daily chart, logarithmic scale)

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Thank you.

For a look at all of today’s economic events, check out our economic calendar.

Sebastien Bischeri
Oil & Gas Trading Strategist

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The information above represents analyses and opinions of Sebastien Bischeri, & Sunshine Profits’ associates only. As such, it may prove wrong and be subject to change without notice. At the time of writing, we base our opinions and analyses on facts and data sourced from respective essays and their authors. Although formed on top of careful research and reputably accurate sources, Sebastien Bischeri and his associates cannot guarantee the reported data’s accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Bischeri is not a Registered Securities Advisor. By reading Sebastien Bischeri’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Sebastien Bischeri, Sunshine Profits’ employees, affiliates as well as their family members may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

About the Author

Sebastien Bischeri is a former Reserve Officer in the French Armed Forces (Navy), and began his career in computer science and engineering, prior to move into banking, finance, and trading. He has worked as a contractor with top banks, firms, government departments, MNCs, SMEs and start-ups over the past decade, where he’s gained extensive knowledge of commodities, economic intelligence, energy, financial markets, investments, risks, and strategy (both as a Trader and Analyst).

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