Oil & Gas Prices - April 19
Posted: Mon Apr 19, 2021 8:44 am
Opening Prices:
> WTI is up 1c to $63.14/Bbl, and Brent is up 5c to $66.82/Bbl.
AEGIS: The Trend remains UP and Buyers are in Control above $61.30. Market Driven hedges are available at current prices. Only a close below $57.60 will change Trend to DOWN and tell us more downside risk is present.
> Natural gas is up 3.6c to $2.716/MMBtu.
AEGIS: The Trend is UP and Buyers are in Control above $2.61. Noisy Spring shoulder trading continues, so price signals are less helpful.
AEGIS notes
Oil
The massive surplus in oil and refined products inventories amassed during the pandemic is nearly gone – IEA
Barely 20% of inventories added last year remain in storage tanks as OPEC and its allies have been able to help keep production offline to deplete inventories
Inventories were 57 MMBbls above their five-year average estimate as of February, down from a 249 MMBbl surplus last July
Global consumption of oil based products is ~95 MMBbls per day and the high demand period is fast approaching
New demand concerns resurface on India COVID-19 outbreak that threatens demand in the world’s third-largest importing country
Less than 100 critical care beds were available in the city of more than 20 million people.
Further, the positivity rate has increased to 30% from 24% the day prior
The country reported 261,500 new cases on Sunday
Certain provinces, cities in India have imposed lockdowns. However, the restrictions fall shy of completely limiting mobility among its population.
If the situation continues to worsen, lockdowns could become more strict
China crude inventories grow, higher prices to deter future builds (Reuters)
China storage levels increased in March as strong imports and domestic production outpaced refinery inputs
Nearly 1.63 MMBbl/d was deposited into storage in contrast with an average of 920 MBbl/d in January and February
Natural Gas
Natural gas prices are higher for the third consecutive day as of Monday morning
The May contract has rebounded from a recent low (April 6) of $2.45 to trade near $2.71 as of April 19
The remaining Summer 2021 strip (May-Oct) has increased by $0.23/MMBtu to $2.83 over the same period
Winter 2021-2022 has also recovered in the past few weeks, up to $0.18/MMBtu to $3.06
AEGIS notes that 2022 has moved much less compared to the front two strips. Price action for 2022 has been mostly sideways for the past 4-5 months. At its current price of $2.70, AEGIS believes Cal 2022 is still undervalued
Strong demand for U.S. LNG this summer is KEY to my forecast that ngas and NGL prices will be much higher YOY in 2021
Robust gas storage demand in Europe has lead to a 74% increase in LNG imports for March (Platts)
Exporters of LNG could have anticipated that European storage requirements would drive demand for gas over the summer and could have sold their cargoes to the region the month before summer delivery began, according to Platts
Reduced gas flows into Europe from Russia via Ukraine is another reason for the European storage depletion year-to-date
So far in April, France, and the Netherlands have already imported more shipments from the US and Russia between them than they did in the whole month of January and February combined
AEGIS notes that this past winter in Europe was colder than average and brought gas inventories to below five-year average levels
> WTI is up 1c to $63.14/Bbl, and Brent is up 5c to $66.82/Bbl.
AEGIS: The Trend remains UP and Buyers are in Control above $61.30. Market Driven hedges are available at current prices. Only a close below $57.60 will change Trend to DOWN and tell us more downside risk is present.
> Natural gas is up 3.6c to $2.716/MMBtu.
AEGIS: The Trend is UP and Buyers are in Control above $2.61. Noisy Spring shoulder trading continues, so price signals are less helpful.
AEGIS notes
Oil
The massive surplus in oil and refined products inventories amassed during the pandemic is nearly gone – IEA
Barely 20% of inventories added last year remain in storage tanks as OPEC and its allies have been able to help keep production offline to deplete inventories
Inventories were 57 MMBbls above their five-year average estimate as of February, down from a 249 MMBbl surplus last July
Global consumption of oil based products is ~95 MMBbls per day and the high demand period is fast approaching
New demand concerns resurface on India COVID-19 outbreak that threatens demand in the world’s third-largest importing country
Less than 100 critical care beds were available in the city of more than 20 million people.
Further, the positivity rate has increased to 30% from 24% the day prior
The country reported 261,500 new cases on Sunday
Certain provinces, cities in India have imposed lockdowns. However, the restrictions fall shy of completely limiting mobility among its population.
If the situation continues to worsen, lockdowns could become more strict
China crude inventories grow, higher prices to deter future builds (Reuters)
China storage levels increased in March as strong imports and domestic production outpaced refinery inputs
Nearly 1.63 MMBbl/d was deposited into storage in contrast with an average of 920 MBbl/d in January and February
Natural Gas
Natural gas prices are higher for the third consecutive day as of Monday morning
The May contract has rebounded from a recent low (April 6) of $2.45 to trade near $2.71 as of April 19
The remaining Summer 2021 strip (May-Oct) has increased by $0.23/MMBtu to $2.83 over the same period
Winter 2021-2022 has also recovered in the past few weeks, up to $0.18/MMBtu to $3.06
AEGIS notes that 2022 has moved much less compared to the front two strips. Price action for 2022 has been mostly sideways for the past 4-5 months. At its current price of $2.70, AEGIS believes Cal 2022 is still undervalued
Strong demand for U.S. LNG this summer is KEY to my forecast that ngas and NGL prices will be much higher YOY in 2021
Robust gas storage demand in Europe has lead to a 74% increase in LNG imports for March (Platts)
Exporters of LNG could have anticipated that European storage requirements would drive demand for gas over the summer and could have sold their cargoes to the region the month before summer delivery began, according to Platts
Reduced gas flows into Europe from Russia via Ukraine is another reason for the European storage depletion year-to-date
So far in April, France, and the Netherlands have already imported more shipments from the US and Russia between them than they did in the whole month of January and February combined
AEGIS notes that this past winter in Europe was colder than average and brought gas inventories to below five-year average levels