Opening Prices:
WTI is up 1c to $60.94/Bbl, and Brent is up 6c to $66.23/Bbl.
Natural gas is down 3.7c to $2.249/MMBtu.
EIA Weekly Report Details:
> U.S. oil production was 12.9 million barrels per day the last two weeks of November and it has dropped to 12.8 million BOPD the first two weeks of December.
Days of Supply in U.S. commercial storage
> 27.0 : Crude Oil
> 26.0 : Gasoline
> 20.5 : Jet Fuel
> 31.7 : Distillates
See more details of the EIA weekly petroleum report here: https://www.eia.gov/dnav/pet/pet_sum_sn ... _nus_w.htm
Raymond James comments on EIA weekly report (12-18-2019):
"With the phase one U.S.-China trade deal in place, and Brexit uncertainly also reduced, oil prices have bounced in recent days to three-month highs. However, there remain some demand-related concerns. The much more bullish supply side of the equation is still mostly being overlooked: the larger U.S. producers are exhibiting restraint in capital allocation, and U.S. well productivity improvements are slowing down; OPEC plus Russia’s production cuts include especially strong Saudi discipline, which is set to continue following the recent OPEC meeting and the IPO of Aramco; U.S. sanctions against Iran continue to be impactful, and Venezuela’s domestic crisis shows no signs of ending; and IMO 2020is on deck two weeks from now. The 12-month futures strip ($58.77/Bbl for WTI and $62.83/Bblfor Brent) shows modest backwardation for both Brent and WTI; for comparison, our new 2020 forecast is $65.00 WTI/$70.00 Brent. There remain several key question marks: 1) on the bullish side, the possibility of supply disruptions above and beyond the current ones, such as a potential scenario of military escalation vis-à-vis Iran, and 2) on the bearish side, the uncertain global macro landscape and resulting read-through for oil demand." < RJ is forecasting that WTI averages $60 in 1H 2020 and then rises steadily to an exit price of $75 by December 31, 2020.
Oil & Gas Prices - Dec 19
Oil & Gas Prices - Dec 19
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil & Gas Prices - Dec 19
Everyday that WTI closes over $60/bbl firms it up as a support level.
My SWAG is that signing of the Phase One Trade Agreement with China will set a new trading range for WTI in the $61 to $65 area. Then traders will focus on U.S. oil production, which looks more and more like it will go on steady decline in Q1 2020.
If you were on the Aegis Energy Webinar today, you learned that EIA has significantly lowered their oil production growth forecast for U.S. crude oil. EIA now thinks U.S. oil production will only growth 300,000 barrels per day from December, 2019 to December, 2020. That is a rounding error in a world that will consume over 102,000,000 barrels of oil based products per day. Plus, U.S. oil production growth will only happen if we see oil prices rise, probably to $70/bbl, before upstream companies ramp up their drilling programs again.
Today, we don't have enough rigs drilling for oil to hold production flat much longer. It may have peaked on Thanksgiving.
My SWAG is that signing of the Phase One Trade Agreement with China will set a new trading range for WTI in the $61 to $65 area. Then traders will focus on U.S. oil production, which looks more and more like it will go on steady decline in Q1 2020.
If you were on the Aegis Energy Webinar today, you learned that EIA has significantly lowered their oil production growth forecast for U.S. crude oil. EIA now thinks U.S. oil production will only growth 300,000 barrels per day from December, 2019 to December, 2020. That is a rounding error in a world that will consume over 102,000,000 barrels of oil based products per day. Plus, U.S. oil production growth will only happen if we see oil prices rise, probably to $70/bbl, before upstream companies ramp up their drilling programs again.
Today, we don't have enough rigs drilling for oil to hold production flat much longer. It may have peaked on Thanksgiving.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group