The Energy Report | Baby’s its Cold

Posted on 12/27/2017 1:40 PM


So much for global warming! Winter is back and back with a frosty reminder that it can still get cold. Really cold. The first real blast of winter in a very long time and the market is trying to get a feel for how that may impact supply. Natural gas, that has been held back by record natural gas production, will finally get a test. The mantra that it can’t get cold enough to turn this market around will be put to the test. If this arctic blast hangs in we could see some of the biggest withdrawals that we have seen in years, even with U.S. production near some records.

Heating fuels are going to be supported as well. Gas oil in Europe is on the rise. Europe has its own Arctic cold blast and that is driving prices. Heating oil prices in the U.S. are flat. The key now is how long the cold temperatures will stay around. This may determine how the market might be impacted. It looks like the cold is going to settle in across much of the nation and the demand for heating fuels.

Reuters reported that U.S. energy companies kept the oil rig count unchanged this week, General Electric Co’s Baker Hughes energy services firm said on Friday, even though crude prices hovered near their highest level since the summer of 2015.

The rig count, an early indicator of future output, held at 747 in the week to Dec. 22, still much higher than a year ago when only 523 rigs were active after energy companies boosted spending plans for 2017 as crude started recovering from a two-year price crash.

The increase in U.S. drilling lasted 14 months before stalling in August, September and October as some producers trimmed their 2017 spending plans after prices turned softer over the summer. Energy firms started adding rigs again in November as crude prices rose.

Yet, is the stalling of rig counts because of the holiday or a sign that U.S. shale oil producers are starting to get smart and pay attention to the well head economics. Will we hit $60 WTI before the end of the year? The countdown begins!

Tune into the Fox Business Network (FBN) is the best in business! The MoneyShow Orlando is coming in February. I will be speaking along with some of the top names in the financial industry. You can sign up for my Masters Class at or see me at the opening ceremonies!

Call me at 888-264-5665 or email me Get my daily trade levels for all major markets. Also call me to get signed up for John Kemps reports.


You can follow Price Futures Group on Twitter or click here for their website.


The views, opinions and positions expressed by the author are theirs alone and do not necessarily reflect the views, opinions or positions of the Inputs Monitor.

Futures and options trading involves substantial risk of loss and may not be suitable for everyone. The valuation of futures and options may fluctuate and as a result, clients may lose more than their original investment. In no event should the content of this website be construed as an express or implied promise, guarantee, or implication by or from The PRICE Futures Group, Inc. that you will profit or that losses can or will be limited whatsoever. Past performance is not indicative of future results. Information provided on this website is intended solely for informative purpose and is obtained from sources believed to be reliable. No guarantee of any kind is implied or possible where projections of future conditions are attempted.

The leverage created by trading on margin can work against you as well as for you, and losses can exceed your entire investment. Before opening an account and trading, you should seek advice from your advisors as appropriate to ensure that you understand the risks and can withstand the losses.

Add new comment