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

The Energy Report

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


Short and Intense. The Energy Report 10/28/2026

Petroleum prices are putting the war premium back in after the Wall Street Journal reported the U.S. told several Gulf Arab nations to prepare for a possible short, intense military campaign against Iran after the midterm elections. This is a recycled version of last week’s story, except the timing has shifted past the weekend. Make no mistake: pressure is building to finish the job against the Iranian regime.

The WSJ says U.S. forces are moving a Patriot battery from Texas, restocking munitions, prepping bombers and fighters, and adding another carrier strike group plus a Marine unit to the roughly 20 warships already in the region. Trump is leaning toward a large post-midterm strike on Iranian infrastructure and nuclear sites but hasn’t pulled the trigger yet. He’s said he won’t act before the midterms and floated “another little Epic Fury—or they’ll agree.” Fox News has highlighted the drills and reports that Iran is preparing for war, not diplomacy—putting the risk premium right back into the market. Yesterday oil sold off hard (WTI down nearly 2% and under $100) after reports the Ayatollah came out of hiding and pushed conditions for ending the war. This morning, Reuters says Qatari mediators handed Iran a new draft deal in Tehran on Sunday—a seven-day timeline with daily confidence-building steps. Iran is reviewing it, response expected by week’s end, with multiple countries as guarantors. Qatar wants Iran to stop threatening Gulf states and reopen Hormuz to show good faith.

Any major strike is still more likely after the midterms. Attention is also on the Israeli election, where Netanyahu’s bloc is running ahead of Gadi Eisenkot’s opposition in a tight race, though short of a clear majority with votes still being counted.

Melania Trump’s humanitarian ceasefire in the Russian-occupied Ukrainian city of Oleshky appears to be advancing, with both sides set to pause for aid and evacuations. Putin is reportedly preparing to speak with leaders of Norway and Finland about broader peace prospects. One unconfirmed report has him inviting Zelenskyy for direct talks with security guarantees—watch for confirmation.

The market is also focused on supply while Democrats continue to hammer high gas prices the ones they used to love! “Remember Pete Buttigieg’s answer to high gas prices? Buy an electric car and you’ll ‘never have to worry about gas prices again.’ Tell that to the family that can’t afford the car, or the electric bill.” And at that time, AAA estimated a new compact EV cost about $600 more per year to own than a gas-powered compact, even with lower fuel and maintenance costs. And of course you expect politicians to be hypocritical and they also fail to point out that a lot of the problems that we’re having with the tightness of supply with the war between Russia and Ukraine and they war with Iran is because of their shortsighted energy policies which is why President Trump reversed the Biden-era regulations that put small producers out of business and amounted to an assault on the U.S. energy industry.

And it was not only the world rumors that it supported prices the market also seemed to get support from the American Petroleum Institute report which showed another 2.03 million barrel crude dollar that came after last week’s huge 4.93 million crude oil drop in Cushing OK the stocks fell 453,000 barrels . Well on the plus side gasoline inventories increased by 2.39 million barrels in distillate inventories rose by 380,000 barrels so the focus on products continues to be something traders have to keep an eye on.

Where natural gas is concerned, the short-term outlook has been driven by the shoulder season weather.

Fox Weather continues to point out that the outlook for weather will be mild, with not a lot of demand for natural gas as we move deeper into November. Above-normal temperatures across much of the eastern two-thirds of the country are expected to limit heating loads, keeping residential and commercial demand subdued in this transitional period.

LNG exports, of course, continue to be strong as we have to send supplies to Europe. Feedgas flows to U.S. export terminals have been hovering near record highs, recently around 19–20 Bcf/d, with Europe remaining the dominant destination amid ongoing needs to refill inventories and replace other supplies. That export strength has provided a floor under prices even as domestic weather has softened demand.

At the same time, EBW Analytics is pointing out that weather-driven demand has shed about 25 gas heating degree days since Friday, yet the November contract has recovered initial losses ahead of Wednesday’s final settlement—perhaps an early sign of a budding relief rally. Still, December fell to $3.004 while January 2027 reached $3.46/MMBtu to hit fresh four-year lows. Fundamentally, production curtailments amid physical weakness may offset a portion of the lower weather-driven demand. While a near-term relief rally is favored, storage set to approach 3.9 Tcf coupled with extremely mild November weather may eventually erode the December contract into Thanksgiving.The medium-term fundamental outlook remains bearish, EBW notes, with risks of either continued mild weather or a seasonal production boom—or both—favoring NYMEX weakening. Risks of extremely mild December weather are elevated. While winter weather will ultimately govern longer-term outcomes, chances for exceptional price weakness nearing $2.00/MMBtu in spring 2027 appear to be an elevated risk.

That is why you need to download the fox weather app to keep up with all the late breaking weather also stay tuned to the Fox Business Network also sign up for my daily trade levels that are wildly popular that covers all the major futures markets as well as specific option and spread plays they may even throw in a seasonal now and then so make sure you sign up the number is 888-264-5665 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.