Oil & Gas Prices - Mar 15

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dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Oil & Gas Prices - Mar 15

Post by dan_s »

Oil Prices:
> WTI is down $2.79 to $68.54/bbl, and Brent is down $2.75 to $74.70/bbl.
> Natural gas is down -8.9c to $2.484/MMBtu. (As of 08:33 AM CDT)

AEGIS Notes
Oil

Oil fell below $70 for the first time since December 2021 as concerns over tightening monetary policy and banking turmoil compete with Chinese demand recovery
April ’23 WTI lost $2.79 this morning to trade around $68.50/Bbl
Crude remains under pressure as concerns of economic slowdown due to rate hikes remain in focus
Last week’s collapse of Silicon Valley Bank and Signature bank, in addition to turmoil at Credit Suisse, continues to weigh on market sentiment

Also weighing on prices this week was a strong U.S. dollar, which makes oil more expensive for buyers holding other currencies < Puzzling to me is how the U.S. dollar is strong with all this noise about bank failures.
However, Chinese economic data showed a recovery in consumer spending, industrial output, and investment after abandoning their Covid-zero policy

OPEC+ and the IEA both forecast a surplus in the near term, citing seasonal demand lulls and higher-than-anticipated Russian production

Global oil demand will exceed supply in late 2023, IEA says
> IEA, in its monthly report for March, expects oil markets to flip from a surplus in 1H2023 to a deficit in 2H2023
> The group held their average 2023 global demand forecast at a +2 MMBbl/d increase as China demand and air travel recover, but down from growth of +2.3 MMBbl/d in 2022
> Even with Russia’s 0.5 MMBbl/d production cut for March, global oil supply “should comfortably exceed demand in the first half of the year,” said the bloc in today’s report
> The IEA forecasts global output growth of +1.6 MMBbl/d and expects a surplus in 1H2023
> But, the agency notes that this increase won't be enough to support demand in 2H2023 since a rise in seasonal demand and China's recovery will drive demand to a record 102 MMBbl/d < < As I have been saying for several months, the seasonal demand spike crude that's coming in May + Chinese demand increasing will push oil demand over supply this summer.

OPEC raises Chinese oil demand forecast but warns of macroeconomic risks (Reuters)
> OPEC, in its monthly report for March, kept its 2023 global demand forecast at +2.3 MMBbl/d but adjusted Americas and European demand lower and Chinese demand higher
> OPEC expects Chinese oil demand to grow by 0.710 MMBbl/d in 2023, up from last month's forecast of 0.590 MMBbl/d
> "The rapid rise in interest rates and global debt levels could cause significant negative spill-over effects and may negatively impact the global growth dynamic," added OPEC

Natural Gas

Natural gas prices trade lower amid a warmer shift in weather forecasts
Forecasts for all regions other than the Rockies and the West have shifted warmer in the 11-15 day period
The 10-year normal Lower 48 temperature will steadily increase, climbing above 55 °F by the end of March, as winter winds down

China increases LNG imports as Japan reduces purchases (Reuters)
China is expected to import 5.39 million tons of LNG in March, up from 4.77 million tons in February, according to data from Kpler
This increase in imports comes amid lower Asian spot prices and a rebound in Chinese economic activity, while Europe's imports are expected to come in at the lowest level since October
Japan, the largest LNG importer in 2022, is on track to receive 4.99 million, which would be its lowest monthly total since May 2020

Canada’s Cedar LNG gets environmental approval (Reuters)
The Cedar LNG export project is being constructed by Pembina Pipeline Corp in British Columbia and will be connected to the planned Coastal GasLink pipeline
Cedar LNG will be one of several Canadian export projects built along Canada's west coast
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - Mar 15

Post by dan_s »

A summary of IEA's monthly "Oil Market Update" for March can be found at this link:
https://www.iea.org/reports/oil-market-report-march-2023
Dan Steffens
Energy Prospectus Group
grimaldi
Posts: 79
Joined: Sat Apr 20, 2013 8:27 pm

Re: Oil & Gas Prices - Mar 15

Post by grimaldi »

Well, since things look that bad, I put in stink bids for Vital and Matador, market will have to drop a lot more to trigger those, tho
dan_s
Posts: 34463
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - Mar 15

Post by dan_s »

Closing Prices:
> Prompt-Month WTI (Apr 23) was down $-3.72 on the day, to settle at $67.61
> Prompt-Month Henry Hub (Apr 23) was down $-0.134 on the day, to settle at $2.439

After the markets closed
At 7:50 PM ET
> WTI is up $0.67 to 68.28
> HH gas is up $0.04 to $2.45
Dan Steffens
Energy Prospectus Group
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