Oil & Gas Prices - Jan 26

[dan_s]

Opening Prices:
> WTI is up 12c to $52.89/Bbl, and Brent is up 11c to $55.99/Bbl.
> Natural gas is up 5.1c to $2.653/MMBtu.

Aegis Morning Notes < EPG Members are invited to attend their webinar on Thursday, Feb 28 at 2pm CT Registration link was email to you yesterday.
Crude Oil

U.S. Department of Justice issues seizure order for Iranian oil shipment
Iran pumped around 2 MMBbl/d in December, with exports only accounting for 10% of total output, according to Bloomberg
Tehran announced that they plan on increasing exports in the coming months on expectations that the Biden administration will ease sanctions. Since this announcement, this is the second vessel containing Iranian crude that has been seized

Libya crude production rebounded following the repair of a major pipeline
The 32-inch pipeline was responsible for transporting around 250 MBbl/d of crude to the nation’s biggest export terminal at Es Sider
Libyan crude output now sits at around 1.25 MMBbl/d. Still, the paramilitary force -the Petroleum Facilities Guard, has threatened to stop oil exports in a dispute over unpaid salaries

The IMF upgrades its 2021 global economic outlook (Argus)
The global economy will grow by 5.5% this year, a 0.3% percentage point increase from its previous outlook three months ago, according to the IMF
China and the U.S. will emerge from the pandemic-related decline in a better position than other countries, IMF projections show. The economies of both countries in 2022 will be only around 1.5pc smaller than the pre-pandemic forecasts, in contrast with countries in the Middle East, Central Asia region, and Latin America who are projected to remain 6-7% below pre-pandemic levels

Natural Gas

Venture Global proposes another Gulf Coast LNG facility capable of producing up to 24 mt/y (~3.15 Bcf/d) in Cameron, Parish Louisiana (FERC)
The newly announced project is called CP2 LNG and the company plans to begin construction of the project in 2Q 20203, making its first delivery of LNG in Q2 2025 (Platts)
CP2 LNG would include 18 liquefaction blocks, each having a nameplate of 1.1 million mt/y, four LNG full containment storage tanks, two marine loading berths, and an onsite, 1,400 MW combined-cycle gas-turbine power generation station

Preparatory work in Danish waters has begun for the approved pipe-laying vessel laying the remaining pipeline for the unfinished Nord Stream 2 pipeline (Bloomberg)
The Russian pipelaying vessel Fortuna has started work despite U.S. sanctions (this is a test for Biden)
About 93 miles of Nord Stream 2 remains to be laid in German and Danish waters, but U.S. sanctions have created long delays in its completion
The completion of Nord Stream 2 will allow Russia to bypass multiple legacy pipelines running through Ukraine to ultimately reach Germany and the rest of Western Europe

If you haven't done it yet, I high recommend that you watch the video we emailed to EPG members yesterday. It will help you understand that using more gas for power generation is the only way this world can reduce carbon emissions in the near-term. Wind and solar will increase, but they can't keep up with global electricity demand.

[dan_s]

Closing Prices:
> WTI prompt month (MAR 21) was down $0.16 on the day, to settle at $52.61/Bbl.
> In contrast, NG prompt month (FEB 21) was up $0.054 on the day, to settle at $2.656/MMBtu.

The weather pattern has shifted and February is now looking quite bullish for space heating demand.