Oil & Gas Prices - May 27
Posted: Thu May 27, 2021 8:32 am
Opening Prices:
> WTI is down 47c to $65.74/Bbl, and Brent is down 52c to $68.35/Bbl.
> Natural gas is down 2.8c to $2.999/MMBtu.
AEGIS Notes
Crude Oil
OPEC+ is expected to reaffirm plans to boost oil production when they meet next week
Twenty of 24 analysts and traders surveyed by Bloomberg predict that OPEC+ will confirm and agree on an increase of 840 MBbl/d scheduled for July, completing a three-part process to increase output by 2 MMBbl/d
Bloomberg reported several of the OPEC+ delegates who asked not to be identified said the same
In a May 26 report, Citigroup said OPEC+ might rethink their planned rise in supply for July amid the Iran nuclear talks
Oil prices regained early morning losses on Wednesday after the EIA reported a crude and product draw for the week ended May 21
The EIA reported a 1.66 MMBbl withdrawal in US crude inventories, a similar amount to the previous day’s API estimate
Stocks at Cushing fell 1.0 MMBbl < A year ago there was FEAR that the tanks at Cushing would overflow, now they are on steady decline and U.S. crude oil in storage is below the 5-year average as we head into the peak demand period for transportation fuels. What a difference a year makes!
US gasoline stocks dipped by 1.7 MBbl to 232.5 MMBbl – close to the lowest level in the past five years for the same week
Refinery utilization rose 0.7% to 87% nationally
Utilization is underperforming versus previous years, excluding 2020. A more normal utilization percent for the same week is closer to 92% or 1.5 MMBbl/d higher inputs < As I have been telling you in my weekly podcasts, refiners MUST RAMP UP GASOLINE PRODUCTION because days of supply are too low and we could see regional shortages if a hurricane takes refining capacity offline this summer.
Natural Gas
The EIA is expected to report a 107-Bcf injection for the week ending May 21, which would be more than the 105-Bcf build in the corresponding week of last year. Analysts estimates ranged from a build of 94 Bcf to 112 Bcf
A build within this range would bring total stocks near 2.207 Tcf and the deficit to the five-year average near 71 Bcf
The current end-of-season storage number settled at 3.6 Tcf on ICE
Strong Asian LNG demand helps absorb cargo diversion from India amid COVID-19 resurgence (Platts)
LNG sellers have been able to divert cargoes and avoid force-majeure notices due to high LNG spot prices in Asia, with JKM trading at around $10.625/MMBtu
According to Platts, India has been importing around 3 Bcf/d of LNG in recent months, with 2.6 Bcf/d believed to be under contract. Cutting 0.5 Bcf/d of LNG imports may only amount to 15-Bcf
> WTI is down 47c to $65.74/Bbl, and Brent is down 52c to $68.35/Bbl.
> Natural gas is down 2.8c to $2.999/MMBtu.
AEGIS Notes
Crude Oil
OPEC+ is expected to reaffirm plans to boost oil production when they meet next week
Twenty of 24 analysts and traders surveyed by Bloomberg predict that OPEC+ will confirm and agree on an increase of 840 MBbl/d scheduled for July, completing a three-part process to increase output by 2 MMBbl/d
Bloomberg reported several of the OPEC+ delegates who asked not to be identified said the same
In a May 26 report, Citigroup said OPEC+ might rethink their planned rise in supply for July amid the Iran nuclear talks
Oil prices regained early morning losses on Wednesday after the EIA reported a crude and product draw for the week ended May 21
The EIA reported a 1.66 MMBbl withdrawal in US crude inventories, a similar amount to the previous day’s API estimate
Stocks at Cushing fell 1.0 MMBbl < A year ago there was FEAR that the tanks at Cushing would overflow, now they are on steady decline and U.S. crude oil in storage is below the 5-year average as we head into the peak demand period for transportation fuels. What a difference a year makes!
US gasoline stocks dipped by 1.7 MBbl to 232.5 MMBbl – close to the lowest level in the past five years for the same week
Refinery utilization rose 0.7% to 87% nationally
Utilization is underperforming versus previous years, excluding 2020. A more normal utilization percent for the same week is closer to 92% or 1.5 MMBbl/d higher inputs < As I have been telling you in my weekly podcasts, refiners MUST RAMP UP GASOLINE PRODUCTION because days of supply are too low and we could see regional shortages if a hurricane takes refining capacity offline this summer.
Natural Gas
The EIA is expected to report a 107-Bcf injection for the week ending May 21, which would be more than the 105-Bcf build in the corresponding week of last year. Analysts estimates ranged from a build of 94 Bcf to 112 Bcf
A build within this range would bring total stocks near 2.207 Tcf and the deficit to the five-year average near 71 Bcf
The current end-of-season storage number settled at 3.6 Tcf on ICE
Strong Asian LNG demand helps absorb cargo diversion from India amid COVID-19 resurgence (Platts)
LNG sellers have been able to divert cargoes and avoid force-majeure notices due to high LNG spot prices in Asia, with JKM trading at around $10.625/MMBtu
According to Platts, India has been importing around 3 Bcf/d of LNG in recent months, with 2.6 Bcf/d believed to be under contract. Cutting 0.5 Bcf/d of LNG imports may only amount to 15-Bcf