Oil & Gas Prices - Nov 11

[dan_s]

Opening Prices:
> WTI is down 70c to $80.64/Bbl, and Brent is down 42c to $82.23/Bbl.
> Natural gas is up 8.9c to $4.969/MMBtu.

My comments are in blue.

AEGIS Notes
Oil

Oil futures retreat as traders weigh potential action from the White House to lower energy costs
> President Joe Biden said that reversing inflation is now his top priority, particularly in energy < Whatever is Joe's Top Priority is going to get screwed up. IMO his team is clueless when it comes to energy.
> Biden is also receiving pressure from fellow democrats to address rising gasoline prices with measures such as a ban on oil exports
> “If you block crude and cause an artificial drop in WTI price, you probably hurt the driller more than you help the driver,” said Kevin Book, managing director of research firm ClearView Energy Partners (Bloomberg)

The U.S. could release 45-60 MMBbl from the SPR by bringing forward next year’s mandate sales of 20 MMBbl, according to Citigroup
Doing so may help curb prices, analysts including Francesco Martoccia and Ed Morse (Bloomberg)
45-60 million barrels is less than four days supply of oil now being processed by our refineries. Short-term impact on oil price may be $1 to $2 and long-term impact is higher oil prices and increased national security. OPEC+ will be out of spare production capacity in 6 to 9 months.

Natural Gas

The prompt-month (Dec ’21) is up by 8.9c this morning, near $4.969 < $5.093 at the time of this post.
> Yesterday’s settle of $4.88 was the lowest since September 21 and brought the week’s total losses to 63c
> Weather models remained mostly unchanged during the overnight runs, with the gas-weighted heating degree day forecast for November moving upward by 0.1

The EIA reported a 7-Bcf injection for the week ending November 5 (EIA)
> This was the smallest injection of the season and implies that builds are nearing an end. According to Platts, there may be at least one more, but withdrawals should start soon < We begin the winter heating season with natural gas in storage 119 Bcf below the 5-year average.
> The build was much smaller than the expected build of 15-Bcf, according to Platts, and for the first time in nearly two months, the stat came in below the five-year average build
> Working gas inventories now stand at 3.618 Tcf, 308 Bcf, or 7.8%, less than the year-ago level of 3.926 Tcf and 119 Bcf, or 3.2%, less than the five-year average of 3.737 Tcf
AEGIS Notes that this week’s stat was tighter than we have seen over the last eight weeks, even when adjusting for weather. The pickup in Residential-Commercial demand more than offset the recent production gains, still despite the encouraging stat, gas finished the day in negative territory

[dan_s]

Rising US dollar is a headwind for oil prices: https://www.marketwatch.com/investing/index/dxy

[dan_s]

Closing Prices:
> WTI prompt month (DEC 21) was up $0.25 on the day, to settle at $81.59/Bbl.
> Also, NG prompt month (DEC 21) was up $0.269 on the day, to settle at $5.149/MMBtu.