The Energy Report: Fighting Back Hard

Iran should be running out of options if they are running out of leaders running out of ammunition and they have drawn in their neighbors in a joint effort OK and what’s left of the Iranian regime, Iran’s enemy list is growing as President Trump said that “Saudi Arabia is fighting back hard. Qatar is fighting back. UAE is fighting back. Kuwait’s fighting back. Bahrain’s fighting back. They’re all fighting back. We’re in very strong communication with all those countries, and they’ve all been fighting.” And oil does another Sunday Night opening pop and drop signaling that the oil market action as well as the oil curve suggest that Iran is on borrowed time and predicting a US victory should be at hand.

Prompt WT I hit a high of 10338 overnight before pulling back once again and a far below the 11341 spike high that we saw on the first weekend open after the invasion Brent crude the May contract which goes off the board today hit a high of 1/16/89 overnight before pulling back and that is also well below the 11950 that we saw on the opening weekend of the attack. The prompt May to May contract is a whole $25 lower a year out suggesting that the market does not believe that the war is going to set us into an era of high prices and even in the Brent crude contract it’s larger, almost $32 a barrel.

Still diesel continues to be a problem with the European diesel hitting the new high but US diesel while higher has not taken out its high in part due to US record production and more have oil from Venezuela.

This comes as Pakistan sets it’s ready to host US Iran talks to end the war. This comes as Iran remains defiant as Israel strikes defiant as missiles and drones fired at Israel and leaked video by Iran of underground mine laying boats signaling to the US military it might be time to pull out the bunker busters,

This common sense take on oil prices shows another spike and drop over the weekend but failed to achieve the weekend highs set in the first days of escalated conflict with Iran. One market that did take out that weekend was gas oil (diesel) in Europe — a clear concern as heavy oil and middle distillate supplies remains tight in that part of the world. Europe depends heavily on flows historically routed through the Strait of Hormuz, and refined product shortages are already rippling outward.

Tanker trackers and maritime reports indicate mixed signals on the Strait of Hormuz. Iran has forced some tankers onto new, narrower routes controlled by the Revolutionary Guard, with reports of vessels being charged millions to transit. At the same time, President Trump highlighted over the weekend that Iran allowed 10–20 oil tankers to pass through as a “gesture” or “present,” with more movements potentially starting as early as Monday morning. Alternative routing and limited additional shipments appear to be increasing in response to diplomatic overtures, though congestion remains visible and full normalization is far from assured.

The back end of the oil futures curves is still pricing in a degree of victory (or at least a quicker resolution) for the disruption scenario. The market remains in notable backwardation, with near-term contracts at a premium to longer-dated ones, reflecting immediate physical tightness, while the back end of the curve has eased somewhat from peak war fears. This structure suggests traders are betting on eventual supply relief even as prompt barrels command scarcity premiums.

On the geopolitical side, the Iranian Revolutionary Guard has lost yet another senior leader in recent strikes tied to the ongoing conflict. Israeli and related operations have continued to target high-ranking IRGC figures and naval commanders, adding to a lengthening list of losses that include previous chiefs and spokespersons. These developments keep pressure on Iran’s command structure and its ability to sustain disruptions in key waterways.

Overall, crude benchmarks like Brent traded in the $112 area recently amid the volatility, with physical tightness most pronounced in middle distillates heading into Europe. Any sustained reopening of Hormuz flows could ease the front end quickly, but persistent leadership losses and regional tensions mean the risk premium isn’t disappearing overnight. Markets will be watching tanker movements closely in the coming days for signs of de-escalation versus prolonged chokepoint issues.

If you’re trading natural gas right now, get ready for shoulder-season sell-off! Prices are dipping across the board as spring sunshine sweeps away the last traces of winter’s heating demand.

The bulls had their fun after Winter Storms fireworks, but Mother Nature is taking the stage—resetting the market in a way that’s sparking excitement (especially for those on the short side).

Henry Hub April futures are currently dancing between $2.95 and $3.02/MMBtu, with prompt-month cash prices sliding to about $2.93 this morning.

That’s a refreshing change from the winter heights, courtesy of spring. Spot prices are trending lower nationwide, and while Henry Hub bounced a bit, the chart’s message is clear: milder forecasts from Fox Weather are slashing residential and commercial demand by double digits, week-over-week.

Ah Yes shoulder-season—where it’s too warm for serious heating and not hot enough yet for peak power-generation cooling. Production is powering ahead at record levels near 110 Bcf/d, LNG exports are steady, and the market’s sending a loud signal: supply is racing ahead!

Now, let’s check out Fox Weather’s forecast April outlook calls for classic spring warmth: above-average temperatures throughout the Eastern U.S., with a high-pressure ridge ushering in sunny skies from coast to coast. Expect highs in the 70s and 80s from the Plains to the East Coast, with only a few storms to add variety.

And don’t overlook this: Thursday’s EIA storage report (for the week ending March 27) is the cherry on top of this optimistic sundae. Analysts anticipate the first net injection of the season, with consensus around +40 to +42 Bcf (some models predict even higher if weekend cold fizzles). That’s a dramatic shift from last week’s surprise -54 Bcf draw, which beat expectations and left us at 1,829 Bcf—right in line, or slightly above, the five-year average. With mild weather and strong production, storage is ready to climb fast. Stocks are already 90 Bcf above last year and comfortably near the five-year norm. A big injection print Thursday would solidify the market’s shift to “plenty of supply, modest demand”—which could push prices even lower in the near term.

But here’s the exciting part for traders: this spring reset is real and full of opportunity! Short-term pressure is strong, but keep in mind—LNG exports are ramping up, power demand from AI and data centers is surging, and any hint of a late cold snap or production hiccup could flip the script quickly. The EIA’s STEO still forecasts 2026 averages close to $3.80/MMBtu, so this dip might be your perfect entry point.