Oil & Gas Prices - April 8
Posted: Fri Apr 08, 2022 8:47 am
Opening Prices:
> WTI is up $1.27 to $97.30/bbl, and Brent is up $0.78 to $101.36/bbl.
> Natural gas is up 8.2c to $6.441/MMBtu.
AEGIS Notes
Oil
Oil is on track for its second weekly loss in a row following plans for large releases from government stockpiles and a viral outbreak in China
> Backwardation remains in oil’s curve structure, but monthly spreads have collapsed as the front of the curve moves lower
> WTI’s prompt spread is now only 56c wide, down from $3/Bbl only fifteen days ago
China’s oil demand outlook turns more bearish as its Covid-19 outbreak worsens, lockdowns are extended in Shanghai (Bloomberg)
> The lockdown measures have knocked out 1.2-1.3 MMBbl/d of Chinese transport fuel demand, according to FGE
> “The full lockdown in Shanghai and the severity of the situation there is a little unexpected,” said Mia Geng, an analyst at FGE in Singapore
> There will still be 500 MBbl/d of fuel demand at constant risk in other parts of China, even if the lockdowns in Shanghai end, she said
Natural Gas
Gas continued to rally yesterday, finishing at a 13-year high of $6.359. This morning prices are up by 8.2c, to trade near $6.441
> The EIA reported a strong pull in gas inventories of 33 Bcf. The withdrawal was above the average analyst estimate of 28 Bcf
> Current inventory levels fell to 1.382 Tcf, while the deficit to last year increased to 399 Bcf, and the deficit to the five-year average expanded to 285 Bcf
> At least a dozen shale executives met with European energy officials on Wednesday to discuss the current supply crisis in Europe
> AEGIS notes LNG demand averaged almost 1.7 Bcf/d higher year-over-year in March at 12.9 Bcf/d
MY TAKE: US gas production is down and LNG exports up will keep storage low and continue to push ngas prices higher.
FERC grants Sempra extension to build two pipelines to its LNG facilities; NextDecade seeks an extension, too
> The Sempra extension allows the company until March 31, 2023, to build two pipelines in Texas and Louisiana that will connect to its Port Arthur (TX) LNG facility
> NextDecade also requested an extension until November 2028 to build its RioGRande LNG facility after it reached a long-term offtake contract with China’s ENN on Wednesday
> According to Reuters, nearly a dozen companies have signaled plans for final investment decisions on proposed LNG facilities in 2020 and 2021 but have been postponed until 2022 because of COVID
> WTI is up $1.27 to $97.30/bbl, and Brent is up $0.78 to $101.36/bbl.
> Natural gas is up 8.2c to $6.441/MMBtu.
AEGIS Notes
Oil
Oil is on track for its second weekly loss in a row following plans for large releases from government stockpiles and a viral outbreak in China
> Backwardation remains in oil’s curve structure, but monthly spreads have collapsed as the front of the curve moves lower
> WTI’s prompt spread is now only 56c wide, down from $3/Bbl only fifteen days ago
China’s oil demand outlook turns more bearish as its Covid-19 outbreak worsens, lockdowns are extended in Shanghai (Bloomberg)
> The lockdown measures have knocked out 1.2-1.3 MMBbl/d of Chinese transport fuel demand, according to FGE
> “The full lockdown in Shanghai and the severity of the situation there is a little unexpected,” said Mia Geng, an analyst at FGE in Singapore
> There will still be 500 MBbl/d of fuel demand at constant risk in other parts of China, even if the lockdowns in Shanghai end, she said
Natural Gas
Gas continued to rally yesterday, finishing at a 13-year high of $6.359. This morning prices are up by 8.2c, to trade near $6.441
> The EIA reported a strong pull in gas inventories of 33 Bcf. The withdrawal was above the average analyst estimate of 28 Bcf
> Current inventory levels fell to 1.382 Tcf, while the deficit to last year increased to 399 Bcf, and the deficit to the five-year average expanded to 285 Bcf
> At least a dozen shale executives met with European energy officials on Wednesday to discuss the current supply crisis in Europe
> AEGIS notes LNG demand averaged almost 1.7 Bcf/d higher year-over-year in March at 12.9 Bcf/d
MY TAKE: US gas production is down and LNG exports up will keep storage low and continue to push ngas prices higher.
FERC grants Sempra extension to build two pipelines to its LNG facilities; NextDecade seeks an extension, too
> The Sempra extension allows the company until March 31, 2023, to build two pipelines in Texas and Louisiana that will connect to its Port Arthur (TX) LNG facility
> NextDecade also requested an extension until November 2028 to build its RioGRande LNG facility after it reached a long-term offtake contract with China’s ENN on Wednesday
> According to Reuters, nearly a dozen companies have signaled plans for final investment decisions on proposed LNG facilities in 2020 and 2021 but have been postponed until 2022 because of COVID