Oil & Gas Prices - August 31

[dan_s]

Opening Prices:
> WTI is down 82c to $68.39/Bbl, and Brent is down 69c to $72.72/Bbl.
> Natural gas is down 6.0c to $4.245/MMBtu.

AEGIS Notes
Oil

Oil prices trade slightly lower Tuesday morning after settling over $69/Bbl for the first time in over two weeks on Monday
> The Bureau of Safety and Environmental Enforcement (BSEE) estimates that about 94.6% of the current oil production in the Gulf of Mexico remained shut in on August 30 as a result of storm Ida
> Gulf of Mexico production is expected to resume service gradually, but local refineries may be slower to return
> At least 2 MMBbl/d of oil refining capacity was affected by the storm, which cut power across Louisiana

OPEC+ expects global oil markets to tighten this year even as they pump more oil, but then flip into surplus again in 2022 (Bloomberg)
> Their projection of a tighter near-term oil market should allow them to continue with the plan of reletting 400 MBbl/d a month
> The Saudi oil minister emphasized at the cartels previous meeting that OPEC+ is prepared to pause or even reverse its scheduled output increase if necessary OPEC meets 5 p.m. Vienna time on Wednesday

Natural Gas

Natural gas futures have continued to trend lower to start the week
> The prompt-month contract is down 6c after losing 8.3c during yesterday’s trading session
> According to the Bureau of Safety of Environmental Enforcement, 93.57%, around 2 Bcf/d, of dry gas production is offline in the Gulf of Mexico

Almost 1.1 million homes are without power in Louisiana and Mississippi (Bloomberg)
> Power infrastructure in Louisiana took a beating, with winds that reached up to 150 mph.
> There is no timeline for how long the outages are expected to persist
> The hurricane will have no significant disruptions to operations at Cameron LNG, the closes export facility to the storm’s path
> LNG prices are $15.74 for Dutch TTF and $17.70 for $17.70 for the JKM in Asia

[dan_s]

Closing Prices:
> WTI prompt month (OCT 21) was down $0.71 on the day, to settle at $68.50/Bbl.
> In contrast, NG prompt month (OCT 21) was up $0.072 on the day, to settle at $4.377/MMBtu. < My WAG is that the ngas storage report for the week ending August 27 will be a build of less than the 5-year average of 54 Bcf and I expect the deficit to the 5-year average storage level to widen during September.