Oil & Gas Prices - May 24

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dan_s
Posts: 34465
Joined: Fri Apr 23, 2010 8:22 am

Oil & Gas Prices - May 24

Post by dan_s »

Opening Prices:
> WTI is up $0.17 to $110.46/bbl, and Brent is up $0.24 to $113.66/bbl.
> Natural gas is up 0.9c to $8.753/MMBtu.

AEGIS Notes
Oil


US demand for motor fuel is increasing as travel returns to pre-pandemic levels and the driving season approaches
> US imports of the gasoline from Europe hit a six-month high in the seven days leading up to May 19, according to ship-tracking data < The Northeast US has to import gasoline and diesel because they refuse to approve pipelines into the area, which BTW increases the world's carbon emissions.
> Flows to the US East Coast from Europe will reach 487 MBbl/d this month, the most since May 2019, according to Vortexa
> Meanwhile, U.S. gasoline inventories have fallen for seven consecutive weeks, to 220.2 MMBbls, the lowest since December

The White House is reportedly considering using the Northeast Home Heating Oil Stockpile, a little-used emergency diesel reserve, to alleviate a supply shortage
> The reserve has a stockpile of 1 MMBbls of ultra-low sulfur distillates that were built in 2000 but only utilized once, during Hurricane Sandy in 2012 < Anyone living in the Northeast that heat their home with heat oil should be worried and fill up their heating oil tank early in October.
> Last Monday, the national average price of diesel reached a new high of $5.58/gal, and two weeks ago US distillate stockpiles fell to their lowest level since 2005 < Rationing of diesel in the Northeast may be only a few weeks away. Mayor Pete has no idea what to do.

Russia's state-owned oil company Rosneft has seen the biggest reduction in production since the invasion of Ukraine (BBG)
> Rosneft and its subsidiaries are responsible for around two-thirds of Russia's production cuts since the invasion of Ukraine, as per the data from the Russian Energy Ministry
> Russian oil output in mid-May was 830 MBbl/d lower than in February, according to statistics from the Energy Ministry's CDU-TEK unit

Natural Gas < I will be covering the US natural gas market in my opening remarks at today's luncheon.

The European Union has started to buy gas to refill inventories jointly (Reuters)
> The European Commission, the EU’s executive arm, last week proposed a plan for how the bloc would quit Russian fossil fuels and build a buffer against further energy supply shocks by investing in renewable energy and fossil fuel imports from other sources
> Russia has cut off flows to Poland, Bulgaria, and Finland after they refused the demand from the Kremlin to pay for the fuel in Roubles
> The idea behind the move is that EU countries could gain access to supply that otherwise wouldn’t be available as there are limited gas volumes currently available in the global market

U.S. West, Midwest could face power shortages under extreme heat situations (NGI)
> Drought conditions are forecast to intensify for some U.S. and Canada areas in the coming months, and according to the North American Electric Reliability Corp, could struggle to meet electricity demand this summer
> NERC says that peak power demand is projected to be 1.7% higher than last year
> AEGIS notes that the snowpack for the western U.S. suggest that hydropower could underperform, increasing the need for natural gas for power generation. > > Drought conditions further threaten the U.S. West Coast power grid as wildfire risk threatens electricity transfers, which the region depends on to meet demand
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34465
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - May 24

Post by dan_s »

Closing Prices:
> Prompt-Month WTI (Jul 22) was down $-0.52 on the day, to settle at $109.77
> Prompt-Month Henry Hub (Jun 22) was up $0.052 on the day, to settle at $8.796
Dan Steffens
Energy Prospectus Group
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