Written Commentary
Ag Market View for Oct 20.2026
October 20, 2026
CRUDE OIL
December Crude Oil made new contract highs early Tuesday as the market prices in the prospect of continued interruptions in global supply. Reports of more Houthi attacks on Saudi energy, airport and military targets this week and a report that an oil tanker exploded after striking a mine in the Strait of Hormuz over the weekend have dashed the optimism that Mideast supply on its way back. Reports of Iran’s imminent demise were apparently premature, and Saudi Arabia is apparently seeking help from Egypt in its fight against the Houthis. The President of the IEA is warning that energy markets will not return to normal in 2027.
PRODUCTS
December RBOB is not making new contract highs this morning, but ULSD is close. ULSD may be drawing support from the approach of heating season, even if the weather does not point to robust demand, with RBOB dealing with the end of the key driving season. President Trump’s deal for Russia to immediately supply 2.25 million barrels of diesel to the US and world markets is not very large considering that US implied distillate demand readings have ranged from 3.8 to 4.5 million barrels per week over the last four weeks.
NATURAL GAS
December Natural Gas is back approaching contract lows, as mild weather limits heating demand prospects, and US output appears to be coming back after recent interruptions. On Monday, LSEG said average gas output in the US Lower 48 states averaging around 111.3 bcfd for the month, which while down from record highs of 113.3 August and September, was up from the 110.8 bcfd reported on Friday. The 6-10 and 8-14-day forecasts call for above normal temperatures over most of the lower 48 states, with near normal along the eastern seaboard at times and normal to below normal from the PNW into the Rockies. The longer term forecast shows a mild trend as well.
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