Oil & Gas Prices - Jan 27
Posted: Wed Jan 27, 2021 9:33 am
Opening Prices:
> WTI is down 12c to $52.49/Bbl, and Brent is down 10c to $55.81/Bbl.
> Natural gas is up 5.9c to $2.715/MMBtu.
Aegis Morning Notes
Crude Oil
COVID-19 impact to linger into 2023, reducing demand by 3 MMBbl/d (Vitol)
Surplus refining capacity will also be 3 MMBbl/d above demand, as new capacity additions offset retirements by older refineries
An increase in electric vehicles, working from home, and carbon-free commuting (bikes or walking), as well as city bans on diesel vehicles (Europe, in particular), and the impact of diesel-gate will threaten demand, according to Giovanni Serio, head of research at Vitol
President Biden eyes Dakota Access Pipeline as the project requires a federal easement (Bloomberg)
The U.S. court of appeals for the District of Columbia refused to revive a critical pipeline easement on Tuesday for DAPL, effectively placing the ball in President Biden’s court
According to Bloomberg’s analysis, Biden will likely not interfere in the shutdown of the pipeline, as there are other potential legal avenues that clear a path for the pipeline to be taken out of service. The political capital cost does not warrant action when the same fate for the pipeline could be reached in lower courts
EIA weekly data is due at 9:30 am CST
Natural Gas
Gas prices moved higher overnight to trade near $2.70 for the March contract
Weather model changes in the past 24-hours showed a gain of 5.2 HDDs (10 bcf) as cooler temperatures reached the Southern Midwest and South (Commodity Weather Group)
The longer-dated models for the 11-14 day window showed widespread below-average temperatures across the Lower-48 with more cold staying power west of the Mississippi
NextEra took a new write-down on the Mountain Valley Pipeline (MVP) of $1.2 billion and developers will resubmit environmental permit applications, the company said on its earnings release and FERC filing
In the FERC filing, MVP has come to a conclusion that to advance the project needs to “seek a comprehensive review of all outstanding water body and wetland crossings”
MVP said it believes the resubmissions will not cause an undue delay to the project
“Work on the MVP project is more than 92% complete, with all the work on the three compressor stations and three interconnect facilities complete, and more than 264 miles of pipe welded in place…The project is targeting completion in late 2021.”
> WTI is down 12c to $52.49/Bbl, and Brent is down 10c to $55.81/Bbl.
> Natural gas is up 5.9c to $2.715/MMBtu.
Aegis Morning Notes
Crude Oil
COVID-19 impact to linger into 2023, reducing demand by 3 MMBbl/d (Vitol)
Surplus refining capacity will also be 3 MMBbl/d above demand, as new capacity additions offset retirements by older refineries
An increase in electric vehicles, working from home, and carbon-free commuting (bikes or walking), as well as city bans on diesel vehicles (Europe, in particular), and the impact of diesel-gate will threaten demand, according to Giovanni Serio, head of research at Vitol
President Biden eyes Dakota Access Pipeline as the project requires a federal easement (Bloomberg)
The U.S. court of appeals for the District of Columbia refused to revive a critical pipeline easement on Tuesday for DAPL, effectively placing the ball in President Biden’s court
According to Bloomberg’s analysis, Biden will likely not interfere in the shutdown of the pipeline, as there are other potential legal avenues that clear a path for the pipeline to be taken out of service. The political capital cost does not warrant action when the same fate for the pipeline could be reached in lower courts
EIA weekly data is due at 9:30 am CST
Natural Gas
Gas prices moved higher overnight to trade near $2.70 for the March contract
Weather model changes in the past 24-hours showed a gain of 5.2 HDDs (10 bcf) as cooler temperatures reached the Southern Midwest and South (Commodity Weather Group)
The longer-dated models for the 11-14 day window showed widespread below-average temperatures across the Lower-48 with more cold staying power west of the Mississippi
NextEra took a new write-down on the Mountain Valley Pipeline (MVP) of $1.2 billion and developers will resubmit environmental permit applications, the company said on its earnings release and FERC filing
In the FERC filing, MVP has come to a conclusion that to advance the project needs to “seek a comprehensive review of all outstanding water body and wetland crossings”
MVP said it believes the resubmissions will not cause an undue delay to the project
“Work on the MVP project is more than 92% complete, with all the work on the three compressor stations and three interconnect facilities complete, and more than 264 miles of pipe welded in place…The project is targeting completion in late 2021.”