[+ Font] :: [- Font] :: Printable

The Energy Report

Phil Flynn
http://www.pricegroup.com/
pflynn@pricegroup.com


Blue Wave and Gas Prices. The Energy Report 11/04/2026

You can argue politics and morality all day long, but when Americans step into the voting booth, they mostly vote gasoline prices—and diesel too. One of the biggest self-inflicted wounds of the last decade was the deliberate shutdown of refining capacity by the globalist green-energy crowd. Their real goal wasn’t so much eliminating fossil fuels as gaining more control over how the rest of us live our daily lives. Funny how that works.

The good news is that even with Democrats newly empowered, we’re finally seeing real movement toward expanding refining capacity—at a pace we haven’t seen in years. Sure, a full blue wave could try to slow that down and drag us back into green-energy madness, but President Trump is still in the White House. That means gridlock, and the market is smart enough to treat gridlock as a feature, not a bug.

Just look at Carl Icahn’s CVR Energy. According to the Wall Street Journal, CVR agreed to pay $4.2 billion to buy two refineries from Marathon. CVR itself is now valued near $6 billion, with the stock up 120% this year on the back of those record refining margins. Icahn owns 71% of the shares, his son Brent sits on the board, and CVR has quietly become the seventh-largest publicly traded refiner in the U.S.—still behind the giants like Marathon, Valero, and Phillips 66, but no longer an afterthought. Its plants in Kansas and Oklahoma are printing money while the Russia-Ukraine war keeps global supply tight. The Journal notes that companies of every size are hunting for more refining assets because global capacity constraints are almost impossible to ignore. ExxonMobil and Chevron are already pouring more money into the sector and squeezing extra fuel out of their existing Gulf Coast plants. Valero just scooped up a shuttered Houston refinery once owned by LyondellBasell for $320 million and plans to restart it at 165,000 barrels per day by 2027. Smaller players are circling the same opportunities. The world is short refining capacity—not just the United States—and somebody has to build it.

A Democratic sweep of the House and Senate raises the legitimate fear that we’ll reverse course and let the green-energy experiment start choking supply again. But with Trump still president, the energy sector has a fighting chance to keep expanding instead of shrinking. The market is already pricing that in as a positive.

And let’s not forget diesel—the fuel the green energy mafia spent years treating like a public enemy. That short-sighted vision, the one that assumed we could just will demand away, is now colliding with the real world. You can’t run trucks, farms, mines, or power plants on press releases.

Just today Bloomberg reported that India is scrambling to triple coal stockpiles at its power plants to head off summer blackouts. The coal, power, and railways ministries have jointly ordered miners and rail operators to boost inventories from about 18 million tons now to at least 55 million tons by the end of March.

That’s not a climate conference talking point or a fancy conference where green climate billionaires fly in their private jets—that’s a government staring at the risk of lights going out and deciding fossil fuel is still the practical answer. It also risks friction with other coal users who need the same fuel for industry and transport.

This is the same pattern we see with diesel everywhere: the green agenda treated it as something to phase out, while the actual economy kept needing more of it. India’s move is a blunt reminder that when reliability is on the line, countries still turn to the fuels that work. The market has been quietly pricing that reality in for months, and moments like this just make it harder to ignore.

This comes as President Trump is working the big chessboard. Peace talks involving Russia and Ukraine are moving again, with China in the mix on a possible three-way sit-down with Trump, Putin, and Xi on the sidelines of the APEC summit in Shenzhen later this month.

The focus looks more nuclear and strategic than a full Ukraine settlement, and not everyone (including some in Beijing) is eager to put the war at the center of the table.

Still, any credible path toward easing the Russia-Ukraine conflict would take some of the pressure off global diesel and fuel markets that the war has Expose the stupidity of Europe’s growing dependence on Russia for diesel fuel. The market has been quietly pricing the possibility of less disruption; progress would just make that clearer.

At the same time, the administration is working a deal that could give the U.S. a longer-term military framework in Venezuela. Talks on a status-of-forces agreement are underway with the post-Maduro leadership in Caracas. It wouldn’t instantly plant permanent bases, but it would set the legal groundwork for a more sustained U.S. presence focused on security cooperation and regional stability. Venezuela still holds massive oil reserves, and production has been climbing off the lows of the Maduro era as the U.S. works to help stabilize and recover output. A more secure, predictable presence supports that energy recovery and undercuts the kind of chaos that used to send barrels offline.

Then there’s Greenland. Lawmakers there just approved a trilateral security deal with Denmark and the United States that expands the U.S. military role and opens the door to more bases in the Arctic. It keeps Danish sovereignty in place but gives Washington a stronger hand on a strategically vital piece of real estate—critical for Arctic routes, missile defense, and keeping adversaries from getting a foothold. Trump had pushed hard for this; the market sees it as another brick in a broader national-security and energy-security wall.

Gridlock in Washington may slow some domestic refining gains, but these moves abroad—peace progress that could ease diesel pressure, a firmer hand in oil-rich Venezuela, and a stronger Arctic position—give the energy sector real reasons to stay constructive. The green-energy experiment keeps running into the same wall: when reliability and security are on the line, countries still turn to the fuels and the hard assets that actually work. The market is already pricing that in. And if the Democrats haven’t learned that their time and power will only be till the next election cycle. Because let’s face it they have no plan to or the ability or the know how to lower gasoline and diesel prices.

Natural gas prices continue to be driven by the weather, pure and simple. Over in Europe they’ve got real problems—storage is heading into winter at some of the lowest levels in years after a rough fill season, and they’re basically praying for a warmer-than-normal winter to keep the lights on and the bills from exploding. The International Energy Agency is already warning that tightness could linger well into next year if things don’t go their way. Here at home the market is leaning hard the other direction. Hedge funds have piled into a record short position in U.S. natural gas, the biggest on record going back over a decade, betting prices are headed lower. Production is also running near record levels, so the supply side looks comfortable if the weather cooperates.

Fox Weather has been all over the setup. The FOX Forecast Center is talking about warmer-than-average conditions across much of the northern U.S. thanks to a strong—some are calling it a “super”—El Niño, which tends to keep the big heating demand centers milder. At the same time, Fox Weather is highlighting a major polar vortex disruption that could arrive as early as November 8—potentially the earliest on record. Models show the powerful winds circling the Arctic could reverse direction soon, and the FOX Forecast Center notes the vortex is already very weak. Any cold impacts on the U.S. would likely take several weeks to show up, if they develop at all, and El Niño is expected to keep much of the North milder through November. It’s setting up a classic tug-of-war: Super El Niño favoring mild weather versus the chance of an unusually early polar vortex breakdown that could send Arctic air south later in the month or into December.

Those record bearish bets look smart if the mild El Niño pattern holds, but they also raise the odds of a sharp squeeze if Mother Nature decides to throw a curveball. Overnight Fox Weather was emphasizing the near-term warmth and the fact that immediate Arctic cold is unlikely, yet the longer-range risk of a historic early disruption remains the wild card the market can’t fully price out.

In short, Europe is hoping the winter stays kind. U.S. traders are betting it does. And the polar vortex is still sitting there like the guest nobody invited but everyone knows might show up. For now the path of least resistance is lower, but energy markets have a habit of reminding us that weather forecasts are not guarantees.

Natural gas futures are hovering near $2.90/MMBtu as the market braces for Thursday’s EIA storage report (10:30 a.m. ET) covering the week ending October 30. Consensus is clustered in the mid-to-high 70s to low 80s Bcf range, but we see a leaner build closer to 70 Bcf.

That call is based on the fact that the reporting week featured milder-than-normal temperatures across key demand regions, which suppressed early heating burns while production held near 110 Bcf/d and LNG feedgas remained elevated.

The combination of soft residential/commercial demand and solid supply kept more gas available for storage—yet strong export and power-plant pull, plus any late-week production softness, should limit the size of the injection relative to recent prints.

Last week’s +80 Bcf report put Lower 48 working gas at 3,724 Bcf—38 Bcf above the five-year average but still 147 Bcf below year-ago levels. A 70 Bcf build would keep the surplus modest and preserve the year-over-year deficit, leaving inventories less padded than some earlier forecasts had suggested heading into the heart of the heating season.

So what we could see is if we see a sub 785 BCF print it could be bullish and cause a nice short covering rally especially with managed money holding a sizable net short position if the bill is over 80 it would reinforce the mild weather ample supply narrative and keep pressure on prices most analysts think that the South Central particularly the salt caverns remains a swing at region.

Injection season is in its final stretch. Mild forecasts have delayed the onset of meaningful heating demand, but any shift toward colder patterns in the 8–15 day window would quickly change the tone. Keep an eye on the Fox Weather models—winter is getting closer, and the storage cushion is thinner than it looks on the surface.

Also make sure that you stay tuned to the Fox Business Network because they’re the only network in America that is invested in you and if you haven’t signed up for the wildly popular daily Phil Flynn trade levels today might be the day. Just call me at 888 264 5665 or e-mail me at pflynn@pricegroup.com.



There is a substantial risk of loss in trading futures and options.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. PFGBEST, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Phil is one of the world's leading energy market analysts, providing individual investors, professional traders and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline and energy markets. Phil's market commentary, fundamental and technical analysis, and long-term forecasts are sought by industry executives, investors and media worldwide.

PLACING CONTINGENT ORDERS SUCH AS "STOP LOSS" OR "STOP LIMIT" ORDERS WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS. SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS.

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Alaron Trading Corp. its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Contact Phil at 1-888-264-5665 or pflynn@pricegroup.com.