Oil & Gas Prices - April 20

[dan_s]

Opening Prices:
> WTI is up 24c to $63.62/Bbl, and Brent is up 36c to $67.41/Bbl.
> Natural gas is down 2.1c to $2.728/MMBtu.

AEGIS Notes
Oil

Libyan oil supply falls below 1 MMBbl/d for the first time since November as a budgetary dispute prevents the country from repairing its ailing infrastructure
Libya ramped up production rapidly towards the end of 2020 to reach 1 MMBbl/d after a civil war led to a nationwide oil blockade for most of the year
AEGIS notes that Libyan supply will likely face additional shutdown risks, which could bode well for oil prices

Vitol Group, the worlds largest independent oil trader, expects crude demand to come “roaring” back through next year
The company noted that demand for crude would be up by 7-8 MMBbl/d by the end of 2022
Vitol sees demand for jet fuel lagging the rebound in other petroleum products by around 1.5 MMBbl/d. Still, the group said that they expect demand increases in other oil products, namely petrochemicals, to offset the lost jet fuel demand

OPEC is discussing downgrading next weeks ministerial meeting
The OPEC+ coalition may go ahead with its monitoring committee meeting, rather than the full-scale ministerial meeting, which would imply the group is expected to continue with its plans to revive production gradually

Natural Gas

BP has already reduced its flared volume in West Texas and New Mexico to just 2% of its total, down from as much as 16% in the fourth quarter
Reduced flaring could be in part due to the additional intrastate egress capacity added in the Permian in late 2019
Gas flaring has fallen dramatically in the past 18-months, led by large declines in the Permian and the Bakken
Platts Analytics shows current GOR levels from associated wells at about 3 Mcf per barrel of oil, up from year-ago levels closer to 2.5 Mcf/b
Cuts to emissions and flaring are buoying US production growth in 2021, according to Platts

Significant national heat may bring double-digit cooling degree days (CDDs) as early as two weeks from today, according to Commodity Weather Group
The meteorological consultancy said we typically switch to primarily pop-weighted cooling degree days by the second half of May
The usual crossover from Heating Degree Days (HDDs) to CDDs is about May 13. The earliest we have seen a big double-digit CDD heat result in the past decade was in 2011 (5/30). The latest over the past decade was in 2019 (6/29)

[dan_s]

Oil futures dropped in Tuesday dealings to trade near session lows as India's record daily COVID-19 cases raised concerns over the nation's economy, and demand for oil. India’s Prime Minister Narendra Modi was holding an address to the nation Tuesday evening local time. That raised concern that "there will be more lockdowns in India," said Phil Flynn, senior market analyst at The Price Futures Group. The May West Texas Intermediate crude contract CLK21, -1.94%, which expires at the end of the session, fell $1.61, or 2.5%, to $61.77 a barrel on the New York mercantile Exchange, after trading as low as $61.50. June Brent crude uk:brnm21 lost $1.21, or 1.8%, at $65.84 a barrel on ICE Futures Europe.