Crude Oil and Natural Gas Futures Outlook
Crude oil prices have risen early this week as concern grew regarding armed conflict and a potential political confrontation in Iraq, OPEC’s second-top oil exporter. At the same time natural gas prices dropped below the $4 mark as cooler weather was expected in the US.As Iraq’s PM Nouri Maliki said that he will take the country’s president, Fouad Massoum, to court over what Maliki called a “coup” oil prices were up on both the New York Mercantile Exchange and the London Exchange.
Natural gas for delivery in September was trading at $3.943 per million British thermal units in New York. Prices reached a three-week high of $4.012 per mBtu while the contract added 4.3% last week.
However, last week money managers cut natural gas net-long positions by 21% in the week through August 5th while Goldman Sachs reduced its Q4 natural gas outlook to $4 per mBtu from $4.25.
Tim Evans, an energy analyst at Citi Futures in New York said, “If you are a money manager and you see above-average storage injections week after week and a decline in price, selling is rational. There’s no massive heat wave consistently across the U.S. that is going to spike air-conditioning demand, and we continue to see production numbers that show robust growth.”