Oil & Gas Prices - Oct 20

[dan_s]

Opening Prices:
> WTI is down 94c to $82.02/Bbl, and Brent is down 86c to $84.23/Bbl.
> Natural gas is down 11.6c to $4.972/MMBtu.

AEGIS Notes
Oil

Oil prices slid about 1% on Wednesday morning as the API inventory report signaled an increase in crude stockpiles, and China takes measures to stabilize its power supplies
> China is looking at ways to intervene in the coal market to ensure reasonable prices, while the nation’s energy watchdog hosted a Tuesday meeting with refiners after oil prices soared (Bloomberg)
> The American Petroleum Institute (API) reported a 3.29 MMBbl build in U.S. crude inventories. Government data is due later this morning. < As I have been telling you in my weekly podcasts, October is when refiners must build inventory to have enough feedstock to make heating oil.

West Texas Intermediate has continued to firm up in a bullish backwardation structure as global demand rises
> The spread between the December 2021 and December 2022 contracts for WTI neared $10/Bbl, the widest since 2013
> The steeper the backwardation, the more disparity hedgers realize between prompt contracts versus longer-dated ones

Natural Gas

The prompt-month Henry Hub contract is trading 11.6c lower this morning, near $4.972
> The contract is down 19.4%, or $1.224 from its peak of $6.312/MMBtu reached on October 5
> Feedgas flows are down slightly today at around 10.06 Bcf/d, with Freeport LNG accounting for 0.6 Bcf/d of the decline

U.S. LNG exporters are picking up the loading pace as Europe and Asia compete for cargoes (Bloomberg)
> October’s cargo-per-day pace is currently 4.9% lower than September. However, seven tankers are currently loading, with each at the Sabine Pass and Freeport LNG sites
> Europe cargo imports from the United States are at their highest level since May, when Asia started absorbing more cargoes to replenish storage
Europe has landed 31% of U.S. cargoes this month

[dan_s]

Reuters: Halliburton posts Q3 profit as drilling rebounds, eyes jump in customer spending
U.S. oilfield firm Halliburton Co (HAL) on Tuesday posted its third consecutive quarterly profit and said customer spending in the United States could jump 20% next year, as stronger oil prices and drilling activity boost demand for services and equipment. Oil prices have rallied to multi-year highs with global crude futures climbing 4.5% in the quarter ended Sept. 30, helped by OPEC+'s decision to maintain its planned output increase rather than raising it on global supply concerns.

[dan_s]

Closing Prices:
> WTI prompt month (NOV 21) was up $0.91 on the day, to settle at $83.87/Bbl.
> Also, NG prompt month (NOV 21) was up $0.082 on the day, to settle at $5.170/MMBtu.