Oil & Gas Prices - May 6

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dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Oil & Gas Prices - May 6

Post by dan_s »

Opening Prices:
> WTI is down 62c to $65.01/Bbl, and Brent is down 53c to $68.43/Bbl.
> Natural gas is down 1.5c to $2.923/MMBtu.

AEGIS Notes
Crude Oil


Oil prices weakened despite the large inventory drawdown reported by the EIA on Wednesday
The EIA reported a draw of (-) 7,990 MBbls for the week ending April 30, well above the estimate of a (-) 2,644 MBbls draw
Inventories for the U.S. are now at a deficit of 42.514 MBbls to last year and a deficit of 9.69 MBbls to the five-year average

Iraq brokers secret Saudi—Iran talks, as nuclear pact negotiations remain underway
World powers are currently holding talks to resurrect the 2015 nuclear deal with Iran, where Iran will limit its nuclear activity in exchange for sanctions relief
Iraq has served as a mediating force in the region recently, brokering talks between the U.S. and Tehran administrations, and other regional powers

Jet fuel demand is set to see a 30% demand spike, as pent-up demand returns this summer (Bloomberg)
The EIA projects that jet fuel demand will be up 30% from 1Q2021 levels and is projected to reach 1.47 MMBbl/d in 3Q2021
According to the TSA, the number of passengers to pass through security checkpoints has increased from an average of 913k in January to over 1,377k in the last 30 days

Natural Gas

Haynesville producer Comstock Resources (CRK) plans to grow production as the company looks to capitalize on prices supported by LNG and industrial demand (Platts)
On the company’s Q1 earnings call, Comstock looks to take advantage of Enterprise Pipeline’s Acadian Extension project, which is expected to enter service during Q4. Comstock entered into an agreement to be a major shipper on the Enterprise extension. CEO Jay Allision said, “Our outlook for the remainder of 2021 provides for modest production growth”

Sempra to further delay a final investment decision on its proposed 11 million mt/year Port Arthur LNG project in Texas to 2022
The company says it faces commercial challenges a year after the pandemic began to affect the global marketplace
US LNG developers have had a tough time sanctioning the construction of new facilities over the past year or so despite strong near-term prices and high LNG demand. The only firm supply deal tied to Port Arthur LNG announced so far is a 2 million mt/year sales and purchase agreement that Poland’s PGNiG signed in December 2018
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - May 6

Post by dan_s »

Closing Prices:
> WTI prompt month (JUN 21) was down $0.92 on the day, to settle at $64.71/Bbl.
> NG prompt month (JUN 21) was down $0.010 on the day, to settle at $2.928/MMBtu.

The pattern is traders take the oil price up in the beginning of the week and harvest profits at end of the week. Chart pattern is bullish with higher highs and higher lows. Oil, gas and NGL prices are running about three months ahead of were I thought we'd be when the year started. Q1 actual WTI price of $58 was $3 above my forecast and Q2 is now running about $3 above my $60 forecast.

Oil NEVER goes up or down in a straight line because the paper traders are working it hard.

Trading Economics: "Oil prices fell a second day on Thursday, with WTI crude trading below $65 a barrel as persistent concerns about rising coronavirus cases in India and elsewhere prompted some profit-taking after a recent rally that saw the US benchmark hit their highest since mid-March. On top of that, OPEC+ started this month a gradual easing of oil production curbs after introducing deep cuts since a pandemic-induced oil price collapse in 2020. Putting a floor under prices was a much sharper than expected drop in US crude inventories and an improved demand sentiment in advanced economies such as the US and EU."
Dan Steffens
Energy Prospectus Group
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