Oil & Gas Prices - April 18

[dan_s]

Opening Prices:
> WTI is up $0.18 to $107.13/bbl, and Brent is up $0.28 to $111.98/bbl.
> Natural gas is up 26.3c to $7.563/MMBtu.

AEGIS Notes
Oil

Oil prices moved higher Monday morning as worries about oil demand in China were countered by outages in Libya amid tight global supply
> Libya’s National Oil Corp on Monday warned “a painful wave of closures” had started to hit its facilities (Reuters)
> Data showed that China refined 2% less oil in March than a year earlier as the nation clamps down on movement due to Covid-19

Production in Libya has fallen by more than 500 MBbl/d as political demonstrations disrupt the nation's supply (Bloomberg)
> Libya’s Sharara field in the western part of the country was closed after protestors gathered
> Libya's daily production was as much as 1.1 MMBbl/d as of Sunday (BBG)

Natural Gas

Gas prices are up by another 26.3c, to trade near $7.563
> The forecasted gas-weighted heating degree day total increased by 16 HDDs to 363 HDDs, its highest mark since 367 last Monday
> Lower-48 dry gas production is up by 0.6 Bcf/d, near 94.3 Bcf/d < Always keep in mind that these daily production numbers are EIA's estimates and basically just guesses.
> The United States ended the winter with the least in natural gas in inventories since 2019 < By the end of April storage will be outside the bottom of the 5-year average.

By the end of March, the least amount of natural gas was held in U.S underground storage in inventories since March 2019
> In January, temperatures across the country were colder than normal, which increased residential, commercial, and electric power demand for natural gas.
> Total working inventories had reached a bottom of 1,382 Bcf before increasing by 15 for the week ending April 8
> The increase in heating demand and record-high liquefied natural gas (LNG) exports resulted in above-average withdrawals from working natural gas storage despite increased natural gas production, which has helped widen the deficit to the five-year average to 300 Bcf. < My SWAG is that gas in storage will be 400 Bcf below the 5-year average at the end of May. The only way to reverse the trend is to reduce LNG exports.

Federal regulators approved Mountain Valley Pipeline’s (MVP) request for stream boring
> According to Pipeline & Gas Journal, the pipeline currently has around 180 streams and wetlands that must be crossed to complete the pipeline
> The 300-mile, 42-inch-diameter, 2 Bcf/d pipeline is designed to transport natural gas from northern West Virginia to mid-Atlantic markets
> AEGIS notes that the recent global supply shortage could add pressure on regulators to get projects approved to increase supply. The Appalachian region has been one of the most stringent regulatory environments in the country for new pipelines, despite holding the nation’s largest gas reserves. < Proof once again that we have elected idiots to run the country.