Oil & Gas Prices - May 2

[dan_s]

Opening Prices:
> WTI is down $0.31 to $75.35/bbl, and Brent is down $0.31 to $79.00/bbl.
> Natural gas is down -7.4c to $2.244/MMBtu. (As of 07:55 AM CDT)

AEGIS Notes
Oil

Oil advances losses ahead of Fed meeting amid concerns about an economic slowdown
June ’23 WTI lost 32c this morning to trade around $75.34/Bbl
Crude prices fell yesterday following weak Chinese manufacturing data for the first time since December and economic concerns from the recent banking crisis
Markets are cautious of likely rate hikes by the Fed and ECB this week, with a 25 bp hike expected from the Fed
Equities are down this morning while the U.S. dollar strengthened, making dollar-denominated commodities more expensive for holders of other currencies

Russian oil exports surge despite the output cut threat (BBG)
Russia's oil exports surpassed 4 MMBbl/d last week, showing no signs of threatened output cuts according to Bloomberg’s tanker tracking
Putin's government may resume foreign currency purchases for reserves due to increased oil revenue stabilizing public finances
However, AEGIS believes that the market might not yet account for the supply deficit caused by OPEC+'s output cuts, as their significant effects are anticipated after May

Natural Gas

Natural gas prices are lower by 3% to $2.24, extending yesterday’s losses
The Summer ’23 strip is down 5c to $2.47, and the Winter ‘23/’24 strip fell 3c to $3.50

Lower 48 weather forecasts shifted warmer by 5.3 °F in the two-week period, with average temperatures expected to rise above 65 °F next week

Manchin introduces new energy permitting bill (Reuters)
The new bill would set a two-year limit on environmental reviews of large energy projects and a one-year limit on smaller ones
The legislation also mentions the Mountain Valley Pipeline and calls for its completion
Senator Manchin said that "There is overwhelming bipartisan recognition that our current permitting processes aren't working and equally bipartisan support for addressing it through comprehensive permitting reform legislation"

Asia LNG imports fall amid soft demand in China and Japan (Reuters)
Despite increased purchases from South Asian countries, Japan and China imported less in April
While Asian volumes fell, European imports rose for a third consecutive month to the highest level since December
North Asian spot prices have fallen to $11.05/MMBtu, while low compared to last year, still incentivizes shipping LNG from the US