Oil & Gas Prices - April 8

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Opening Prices:
> WTI is down 20c to $59.57/Bbl, and Brent is down 4c to $63.12/Bbl.
> Natural gas is down 2.9c to $2.491/MMBtu.

AEGIS Notes
Oil

India is preparing to purchase Iranian crude in anticipation of easing U.S. sanctions
India, the world’s second-largest crude importer, has expressed frustration with the elevated cost of supplies from Saudi Arabia
The country is currently dealing with a covid-19 resurgence, recording the highest number of new cases since the pandemic began on Wednesday, April 7, 2021

FGE boost its 2021, 2022 global demand outlook amid Asian demand growth
FGE estimates global demand will grow 6 MMBbl/d this year, a 75 MBbl/d increase from its last forecast
2022 global oil demand is expected to grow by 4.1 MMBbl/d, a 325 MBbl/d increase from its previous estimate
The company noted that a resurgence in COVID-19 cases in Europe and Latin America pose a downside risk to global demand forecasts

The market received mixed signals from inventories data reported by the EIA on Wednesday
The EIA reported a draw of (-) 3,522 MBbls for the week ending April 2, well above the estimate of a (-) 1,638 MBbls draw
Gasoline and distillates inventories increased by (+) 4 MMBbls and (+) 1.5 MMBbls, respectively

Natural Gas

Natural gas futures for May have continued to trade near $2.52 since mid-March
Weather so far this spring has been more moderate on average, resulting in lower than usual demand

LNG exports have remained one of the major bright spots lately. US LNG facilities have been consuming nearly 12 Bcf/d over the past 30 days as of April 7

Higher year-over-year Henry Hub prices have resulted in lower US gas-fired power burns (Platts)
Henry Hub cash prices have traded at an average of $2.65/MMBtu so far this year – after excluding February freeze outliers
Compared to 2020, Hub prices are up about 80c this year, or more than 43%, S&P data showed
This year’s higher gas prices are leading to about 10% more coal generation than the same period last year in MISO (Midcontinent Independent System Operator). Similar losses, but slightly less, have been observed in other electricity regions

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Closing Prices:
> WTI prompt month (MAY 21) was down $0.17 on the day, to settle at $59.60/Bbl.
> In contrast, NG prompt month (MAY 21) was up $0.002 on the day, to settle at $2.522/MMBtu.