Oil & Gas Prices - Nov 9

[dan_s]

This is the "Year of the Roller Coaster Ride" for oil prices. I cannot recall so many wild price swings for oil.

Opening Prices:
> WTI is up $0.98 to $76.31/bbl, and Brent is up $1.00 to $80.54/bbl.
> Natural gas is up 0.5c to $3.111/MMBtu.

AEGIS Notes
Oil

Oil prices are trading higher after falling to a three-month low
The Cal ’24 strip is up 58c to $74.13, and the Cal ’25 strip is up 39c to $70.29
The US Dollar and equity futures are trading higher this morning

The API reported an estimated crude build of 11.9 MMBbls and a 1.1 MMBbl build in Cushing stocks, with official EIA data being released next week

Citi says oil price to consolidate near current levels (BBG)
In a note from Citigroup, the bank said they think oil prices will continue to hold near current levels following the recent price decline
They added further that the market could flip into a global inventory draw, but much smaller than those seen in the third quarter
Weak fundamentals on both the demand and supply side have resurfaced, following bearish China data and higher exports from OPEC in August

Africa’s largest refinery months from start-up (BBG)
The 650 MBbl/d Dangote plant in Nigeria is getting closer to commercial operations following the conclusion of a deal to receive 6 MMBbl of crude in December
The facility is currently building up stocks to conduct test runs, with a full start-up unlikely before the end of 2024
The refinery will be able to run a full range of crude grades, but its initial intake is expected to consist of Nigerian grades such as Bonny Light, Forcados, and Engina

Natural Gas

Natural gas prices snap three-day losing streak after weather forecasts shifted slightly cooler
The Winter ‘23/’24 strip is down 2.5c to $3.215, and the Summer ’24 strip is down by 3.7c to $3.231 < My 2024 forecasts are based on HH ngas averaging $3.25/MMBtu for the year.

Today's weather forecast showed cooler temperatures than yesterday in the Northeast, Midwest, and South Central, with minimal changes to the overall Lower 48 pattern

TC Energy sets new record in NGTL volumes; announces new project approvals (Criterion)
TC Energy’s GTN Xpress received FERC approval in October 2023 for incremental export capacity, expected to be operational by 2024
The project will add over 150 Mmcf/d in capacity through modifications at three compressor stations across Idaho, Washington, and Oregon
The company reported a 0.5 Bcf/d increase in average NGTL receipts in 3Q23 from 2Q23, averaging 14 Bcf/d
Additionally, Bison Xpress, set for construction in 2Q25 and completion in 2026, will augment Northern Border Pipeline System capacity by 0.43 Mmcf/d via compression upgrades in North Dakota

Russia defiant against US sanctions, vows to increase LNG production (Reuters)
Russia vows to continue increasing its LNG output to 100 Mtpa, undeterred by recent U.S. sanctions targeting the Arctic LNG-2 project
Russian Foreign Ministry spokeswoman Maria Zakharova emphasized the prioritization of LNG development, as pipeline gas exports to Europe have significantly dropped due to sanctions following the Ukraine conflict
Despite the U.S. collaborating with partners on sanctioning the project, Russia aims to grow from 8% to 20% of the global LNG market by 2035, with Arctic LNG-2 playing a key role in this plan
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Recent natural gas prices are $14.39 in Europe and $17.29 in Japan/Korea. Incredible profits on LNG cargos exported from the U.S.

[dan_s]

Closing Prices:
> Prompt-Month WTI (Dec 23) was up $0.41 on the day, to settle at $75.74
> Prompt-Month Henry Hub (Dec 23) was down $-0.065 on the day, to settle at $3.041