Oil & Gas Prices - Oct 8

[dan_s]

Opening Prices:
> WTI is up 80c to $79.10/Bbl, and Brent is up 73c to $82.68/Bbl.
> Natural gas is up 3.3c to $5.710/MMBtu.

AEGIS Notes
Oil

Oil is headed for a seventh weekly gain, the longest run since December
> WTI prices received a boost yesterday after the U.S. Energy Department said that it had no plans “at this time” to release the nation’s oil reserves
> A global energy crunch continues to roil markets in Europe and Asia

WTI flipped to small rare call skew on Friday morning (Bloomberg)
> WTI’s 2nd-month 25-delta skew briefly crossed over to the call side for the first time since October 2019
> AEGIS notes that the crude oil forward curve is typically always in perpetual put-skew
I think this tells us that refiners are worried about having enough crude oil supply in 2022.

Natural Gas

EIA reports largest injection of the year for the week ending October 1
> Storage increased by 118-Bcf last week, well above the median analyst estimates of 107 Bcf, and the five-year average of 81 Bcf
> US storage volumes now stand at 2.811 Tcf, which is 532 Bcf, or 14%, less than the year-ago level of 3.820 Tcf and 172 Bcf, or 5%, less than the five-year average of 3.464 Tcf

The prompt-month (Nov ’21) Henry Hub contract is currently up by about 5c, or .09%
> Yesterday, Henry Hub price was virtually unchanged; However, TTF and JKM lost $3.945 and $0.97 to finish at $32.832 and $33.080, respectively
> Several Russian government officials have commented on the European gas shortage and provided reassurances that they will step up if they can fulfill domestic demand

Blomberg data shows LNG feedgas demand is at 10.67 Bcf/d, a two-week high
> The key driver behind the increase was Cheniere’s Corpus Christi LNG facility, with flows increasing by 0.5 Bcf/d
Note from yesterday's webinar: 2 Bcf per day of LNG export capacity will be coming on line as soon as January, 2022. It will increase demand for U.S. natural gas immediately as Europe (TTF) and Asia (JKM) are begging for more supply.