Oil & Gas Prices - Sept 20

Oil & Gas Prices - Sept 20

Postby dan_s » Tue Sep 20, 2022 8:55 am

Opening Prices:
> WTI is up $0.27 to $86.00/bbl, and Brent is up $0.37 to $92.37/bbl.
> Natural gas is up 6.0c to $7.812/MMBtu.

AEGIS Notes
Oil

The DOE will sell 10 MMBbl of low-sulfur oil from the U.S. SPR in November, extending the already planned 180 MMBbl sale, which expires in October (BBG)
> The DOE is offering up to 5 MMBbl from Big Hill in Texas and up to 7 MMBbl from West Hackberry in Louisiana for delivery in November
> Bids are due by September 27, and contracts will be awarded no later than October 7, the department said
> The sale will come before EU sanctions against Russian crude go into effect in December
> To date, the SPR sales have resulted in delivery or commitment for delivery of 155 MMBbl of crude oil through October 22 to help mitigate global supply disruptions < and to improve Biden's poll numbers.

The OPEC+ group continues to vastly underperform its collective oil production target (Reuters, BBG) < As I have been telling you all year.
> OPEC+ fell short of its oil production target by 3.583 MMBbl/d in August, having missed the target quota by 2.892 MMBbl/d in July, according to a report seen by Argus
> While OPEC members were 1.399 MMBbl/d behind the quota, non-OPEC producers were 2.185 MMBbl/d below their quota for August
> Russia and Nigeria were the two biggest laggards of their respective groups, and the next OPEC+ meeting is scheduled for October 5
> The organization increased its monthly target by 0.100 MMBbl/d for September; therefore, the underperformance is expected to be higher this month
> The UAE intends to ramp up its oil production capacity to profit from high energy prices before the world switches to cleaner energy sources
> Currently, UAE produces nearly 3.4 MMBbl/d, and state-owned ADNOC expects to be able to produce 5 MMBbl/d by 2025, which is earlier than the previously disclosed goal of 2030
> The revised target will be challenging to meet and will drive up costs for a project that is already expected to cost billions, according to sources familiar with the matter

Most of the OPEC+ countries are now on terminal decline.

Natural Gas

Natural gas prices are up slightly this morning, following yesterday's 7% rally
> Weather models have shifted cooler again, with temperatures next week expected to be well below the 10-year normal
> Demand for natural gas is expected to peak on Friday, then decline as warm temperatures subside

Cheniere to form a joint venture to construct a pipeline (Reuters)
> Cheniere, the largest U.S. LNG exporter, will partner with units of Whistler Pipeline LLC to construct the ADCC pipeline in Texas
> The pipeline will extend 43 miles from Chenier’s liquefaction facility in Corpus Christi to the terminus of Whistlers Agua Dulce pipeline
> The ADCC pipeline will have a diameter of 42 inches and will be able to transport up to 1.7 Bcf/d, but could be expanded to transport up to 2.5 Bcf/d
> This follows news in June that Cheniere will be adding an $8 billion expansion to its Corpus Christi LNG facility

The amount of LNG on ships is the highest since December 2021 (BBG)
> LNG on water volumes have increased 45% since last week, reaching a total of 3.07 million tons on September 18
> Freight rates in the Pacific have increased $30,000 from last week to a total of $150,000 a day
Dan Steffens
Energy Prospectus Group
dan_s
 
Posts: 30137
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - Sept 20

Postby dan_s » Tue Sep 20, 2022 4:03 pm

Closing Prices:
> Prompt-Month WTI (Oct 22) was down $-1.28 on the day, to settle at $84.45
> Prompt-Month Henry Hub (Oct 22) was down $-0.035 on the day, to settle at $7.717
Dan Steffens
Energy Prospectus Group
dan_s
 
Posts: 30137
Joined: Fri Apr 23, 2010 8:22 am


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