Oil & Gas Prices - Nov 4

[dan_s]

Closing Prices:
> WTI prompt month (DEC 21) was down $2.05 on the day, to settle at $78.81/Bbl.
> In contrast, NG prompt month (DEC 21) was up $0.046 on the day, to settle at $5.716/MMBtu.

Trading Economics this morning:
"WTI crude futures fell more than 2% to below $79 a barrel on Thursday, the lowest in near four weeks after the White House said it will consider the full range of tools to protect the economy in response to OPEC’s decision to maintain the output growth rates unchanged. On top of that, a report from Al Arabiya TV said Saudi Arabia's oil output will reach 10 million bpd in December, the most since the COVID-19 pandemic started, and US crude supplies have been rising more than expected for the past two weeks. Meanwhile, Iran announced it will resume talks with world powers later this month aimed at reviving the Iran nuclear deal, which could increase global oil supplies."

Investing.com - Oil prices settled lower Thursday after giving up gains on profit taking following the decision by OPEC and its allies to stick to their plan to gradually boost production, defying calls from President Joe Biden to ramp-up production.

On the New York Mercantile Exchange, crude futures fell $2.05 to settle at $78.81 a barrel, while on London's Intercontinental Exchange (NYSE:ICE), Brent slipped $1.45 to to trade at $80.54 a barrel.

OPEC and its allies including Russia decided to stick with their previous plan to raise oil production by a 400,000 barrels a day next month.

Biden earlier this week blamed the rise in energy prices on "the refusal of Russia or the OPEC nations to pump more oil."

The major oil producers, however, weren't willing to heed the president's calls, insisting that its current production accord would foster “a stable and balanced oil market."

The White House hit back against the oil cartel and its allies' decision, saying "global recovery should not be imperiled by a mismatch between supply and demand. OPEC+ seems unwilling to use the capacity and power it has now at this critical moment of global recovery."

The remarks from the White House stoked concerns that the U.S. could take measures including the strategic petroleum reserve reserves to boost production and cap prices.

Also souring sentiment on oil, Saudi Energy Minister Prince Abdulaziz bin Salman stoked concerns about after he reportedly said that oil inventories will see "tremendous" builds at the end of 2021 and early 2022 because of slowing consumption, according to an Al Arabiya TV report.
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MY TAKE: I now believe that OPEC+ cannot increase production any faster than they are doing. I also believe that the cartel will run out of spare capacity within six to eight months and probably six. Biden blaming OPEC+ for high gasoline prices is a joke. Team Biden is clueless. Releasing more oil from the SPR is dumb and won't do much anyway.