Oil & Gas Prices - Jan 21

[dan_s]

Keep in mind that we are living through an amazing time in U.S. history. Trump is making a lot of noise, but the fundamentals drive oil & gas prices. Plus, as we approach the end of this wild month, the Paper Traders have to close and roll forward their NYMEX futures contracts.

Trading Economics:
WTI Oil
WTI crude oil futures fluctuated around $76 per barrel on Tuesday, as traders digested a series of executive orders from U.S. President Donald Trump following his inauguration.
> Among these was a plan to impose 25% tariffs on imports from Canada and Mexico starting February 1, dampening investor expectations for a delay. < I will be stunned if Trump puts a tariff that large on oil from Canada.
> Trump held off unveiling specific levies on China, the world's top oil importer, keeping markets on edge.
> Traders are also awaiting further details on sanctions targeting major oil exporters, including Russia, Iran, and Venezuela.
> On Monday, crude prices dropped more than 1%, after Trump announced plans to boost U.S. oil and gas production by declaring a national emergency. < Other than getting rid of the Green New Deal, what's the "emergency".
> Lower geopolitical risk also helped ease prices following the ceasefire and hostage release deal between Israel and Hamas. < Has Hamas ever honored a peace agreement? The only solution in the Middle East is putting Iran permanently out of the business of supporting terrorists.

Natural Gas
Early this morning US natural gas futures rose 2% toward the $3.90 per MMBtu mark on Tuesday, then sold off most of the day until bouncing off support at just below $3.75.
> On Thursday, January 16 the price of the FEB25 NYMEX contract spike to over $4.30 per MMBtu after EIA reported a 258 Bcf draw from storage.
> Much colder than normal weather in the eastern 2/3rds of the U.S. increased demand for space heating fuels and caused well freeze offs.
> President Trump lifted the moratorium on new LNG export licenses in his first day in office, confirming previous pledges during his campaign. The measure allows domestic natural gas producers to take advantage of higher prices overseas and force consumers to compete with higher prices in major LNG hubs in Europe and Asia. < This clears the path for U.S. LNG export capacity to increase from 14.5 Bcf per day the end of 2023 to ~35 Bcf per day by the end of 2026. We should see steady increases in export capacity with large facilities at Plaquemine, Louisiana and Corpus Christi, Texas ramping up exports NOW. Exxon's Golden Pass facility should add 1.6 Bcf per day of export capacity by the end of 2025 to total capacity of 19.4 Bcfpd.
> This week freezing temperatures in the Southern states raised demand for heating in households and frozen power grids.
> Propane, which is used for space heating in rural areas in the Midwest and South has increase from $0.62/gallon at the end of September to $0.93/gallon. < All of our Gassers sell a lot of propane. Propane is the primary driver of NGL prices.
> CelsiusEnergy is forecasting larger than the 5-year average draws for each of the three weeks remaining in January that should push NGas in storage from a 77 Bcf surplus on January 10 to a 151 Bcf deficit by January 31st.

Antero Resources (AR) will benefit the most from increasing NGL prices.

[dan_s]

Trump announced a BIG investment on AI data centers today:
https://www.cnbc.com/2025/01/21/trump-ai-openai-oracle-softbank.html