Oil & Gas Prices - Nov 5

[dan_s]

Trading Economics

Oil
WTI crude oil futures rose to $72 per barrel Tuesday, as investors anticipated uncertainties surrounding the US presidential election. This follows a rise of over 2.9% in the previous session, fueled by OPEC+ postponing its planned production increase for December.
> Market focus is directed toward the outcomes of the US election and the upcoming National People’s Congress meeting in China, which may introduce additional stimulus measures.
> OPEC+'s recent decision to delay the production hike was driven by weak demand and increased non-OPEC supply. Although OPEC's oil output rose in October due to Libya's resumed production, efforts by Iraq to meet its cuts limited overall gains.
> Iran has also approved a plan to boost output by 250,000 barrels per day.
> Meanwhile, a late-season tropical storm in the Gulf of Mexico could potentially reduce US oil production by approximately 4 million barrels.

Natural Gas
US natural gas futures fell over 3.5% to below $2.7/MMBtu on Tuesday due to expectations of mild weather through late November, which is likely to lower heating demand and allow utilities to continue storing more gas.
> Analysts reported an increase in storage injections for the third straight week, the first time this has occurred since October 2023. Previously, injections had been below average as producers scaled back drilling after prices fell earlier in the year.
> December gas futures settled at $2.67 per million British thermal units, despite potential disruptions from Tropical Storm Rafael.
> On the supply side, average US gas production fell to 100.9 billion cfd in November, down from October, partially due to issues with the El Paso pipeline in New Mexico.
> Demand in the Lower 48 states is expected to rise as warmer-than-normal weather persists, and LNG export flows were also slightly reduced due to maintenance, including the shutdown of the Freeport LNG facility in Texas.