The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
1539 ET - Natural gas futures post back-to-back gains with the October contract settling above $3 per million British thermal units after numerous failed attempts recently. With the market in a shoulder month, moves to $3 tend to prompt a pullback, says long-time natural gas trader John Woods. "Every time you get up there you take some profit because you don't want to be long, even at $2.95 and above because you have no push after that," he says. "This pattern has been going on for a good month." Nymex gas settles up 2% at $3.023/mmBtu, its highest close since July 8. (anthony.harrup@wsj.com)
1516 ET - U.S. diesel futures fall as the market weighs news that the Trump administration is considering implementing restrictions on diesel exports. Secretary Chris Wright hinted at a voluntary cap, rather than ban in a WSJ interview. An export ban could create more problems than it solves, says Phil Flynn of the Price Futures Group in a note. Exports are an outlet for U.S. Gulf Coast refiners to keep running hard, he says. "Cut that outlet and storage fills up. Then they cut runs...they don't just make less diesel--they make less gasoline and jet fuel too. That's how you turn a diesel problem into a broader fuel problem." The key to solving the diesel issue is a Russia-Ukraine ceasefire and an end to broader refining disruptions overseas, he adds. Front-month Nymex diesel settles down 3.4% at $4.7764 a gallon. AAA reports the current average price at $6.5217 a gallon, near a record high. (anthony.harrup@wsj.com)
1502 ET - PG&E is dealing with a growing risk from inaction on wildfire liability reform, UBS analysts say, downgrading the stock to neutral from buy. While the analysts expect work on wildfire legislation to continue, there hasn't been action. California Governor Gavin Newsom has spoken about a potential special session on AI, but hasn't mentioned something similar for wildfire reform, the analysts say. They see the delay in a wildfire reform resolution as a negative for PG&E's performance. UBS cuts its price target on the stock to $14 from $19, and lowers its estimate for 2028 earnings per share to $1.90 from $1.95. (katherine.hamilton@wsj.com)
1501 ET - Rising costs of extracting oil and natural gas from U.S. shale rocks increases the importance of Canada to help meet future energy demand, according to a report by Enverus. "The U.S. has [an estimated] 17-year low-cost oil resource life index at current production rates, compared with nearly 53 years in Canada," the energy-focused data-analytics company says. It adds, however, that the Permian Basin, a sprawling region spanning portions of West Texas and southeastern New Mexico, will likely remain North America's main oilfield for more than a decade. That's partly because more investments in oil-and-gas extraction and related infrastructure, including liquefied-natural gas terminals, are needed to tap Canada's reserves, Enverus says. "Realizing [Canada's] potential will require additional oil and gas pipelines, LNG export capacity, and a substantial rotation of capital toward upstream development." (luis.garcia@wsj.com; @lhvgarcia)
1417 ET - A potential plan to implement restrictions on diesel exports may have implications for farmers harvesting crops. Energy Secretary Chris Wright hinted at a voluntary cap, rather than ban in a WSJ interview. On one hand, it could make diesel cheaper for farmers in the Midwest and Gulf Coast, says Jim Wiesemeyer of Ag Bull, citing research from the Atlantic Council. "Farmers buying fuel during that period could benefit, although savings would depend on local delivery prices and purchase timing," he says in a note. But on the other hand, it could lead to refineries lowering their throughput with could actually raise prices, says Wiesemeyer. CBOT grain futures are lower, with corn down 1.3%, soybeans off 0.6%, and wheat 1.4% lower. (kirk.maltais@wsj.com)
1401 ET - Gold futures fall for a third straight session as the U.S. dollar strengthens and Treasury yields rise, including the 10-year yield at its highest level since July 2007. Fed officials have reaffirmed support for last week's interest-rate increase while warning of inflation risks, sustaining odds above 50% of another rate increase in October, Critical Metals' CEO Tony Sage says in a note. "A firmer U.S. dollar and elevated U.S. yields could also continue to keep pressure on bullion." Front-month gold falls 1.3% in New York to $4,281.30 a troy ounce. Silver settles down 2.4% at $64.382 a troy ounce. (anthony.harrup@wsj.com)
1257 ET - Ahead of Carnival's F3Q results slated for next week, Jefferies modestly lowers its estimates, primarily due to fuel. "Brent crude has risen 33% since Carnival's 2Q26 earnings call on June 23, a material move given the company's unhedged fuel exposure," the analysts say in a research note. They add that roughly a third of that increase has occurred this month, which falls in Carnival's F4Q, meaning the outlook for fuel looks increasingly bleak. "We have become less optimistic on near-term easing and now assume higher Brent prices in 1H27," the analysts say. (connor.hart@wsj.com)
1240 ET - Last week's unexpected increase in U.S. crude oil stockpiles as exports fell and refineries cut runs is "slightly bearish" for crude, but keeps upward pressure on gasoline prices, says David Russell of TradeStation. "Energy markets are tight but stabilizing," he says, "but it might be hard for crude to go much lower, given the record crack spreads." The EIA reported a 3 million barrel increase in crude oil stocks, leaving them 2% above the five-year average for the time of year, while gasoline inventories fell by 1.7 million barrels and were 6% below the average. WTI crude is up 2.1% at $92.41 a barrel after falling the previous five sessions. Nymex gasoline futures are up 1.4% at $3.5367 a gallon. (anthony.harrup@wsj.com)
1134 ET -- Gulf non-oil activity is recovering toward prewar levels as businesses adapt their supply chains to regional disruption, S&P Global Market Intelligence says. Aggregate activity across the G.C.C. economies covered by its PMI surveys expanded in August at a pace only just below February's prewar level, as new orders rose sharply and business confidence reached a six-month high. Supplier delivery times also improved for a fourth consecutive month amid better logistics, material availability and greater use of local suppliers. Non-oil activity growth reached a seven-month high in Saudi Arabia and a six-month high in the U.A.E., while output in Qatar contracted further, S&P says. (farhan.rafid@wsj.com)
1119 ET - Yields on U.K. government bonds, or gilts, climb to their highest in more than a week due to accelerating oil prices and increased prospects of the Bank of England raising interest rates at future meetings. Brent crude climbs 2.4% to $101.18 a barrel, reversing recent declines. Markets price in a 71% chance of a BOE rate increase in November, up from 66% probability priced in earlier in the session, LSEG data show. Two-year gilt yields hit 4.898%, while 10-year gilt yields rise to 5.329%, both 9-day highs, LSEG data show. (miriam.mukuru@wsj.com)
1051 ET - U.S. Treasurys would face a fresh round of selling pressure if renewed hopes for a diplomatic breakthrough in Iran prove to be misplaced, BMO Capital Markets' Ian Lyngen says in a note. President Trump is touting a "very good meeting" between the U.S. and Iran, along with plans for another one in the near future, raising hopes that an end to the conflict could be coming, Lyngen says. But it remains unclear if any progress has been made toward a formal deal to reopen the Strait of Hormuz, he says. If talks break down, a rebound in energy prices would weigh on Treasurys, Lyngen says. (dean.seal@wsj.com)
1034 ET - Gold futures are lower as the U.S. dollar gains amid higher U.S. interest-rate expectations. "The near-term setup for gold remains challenging," Kaynat Chainwala of Kotak Neo says in a note. "A dollar holding above 100 and October hike odds above 50% represent a structurally negative combination for non-yielding assets, and further hawkish signals ahead of the October meeting could extend the current pressure." Gold for December delivery is off 1.4% in New York at $4,315.20 a troy ounce. Silver is down 2.2% at $65.04 a troy ounce.
Comments