Oil & Gas Prices - Sept 1
Posted: Thu Sep 01, 2022 8:50 am
Opening Prices
> WTI is down $2.00 to $87.55/bbl, and Brent is down $2.07 to $93.57/bbl.
> Natural gas is up 1.6c to $9.143/MMBtu.
AEGIS Notes
Oil
Oil prices tumbled this morning to trade near $87/Bbl
> WTI fell by $2 amid reports of China widening its Covid-19 restrictions
> Meanwhile, China's official manufacturing PMI data released on Wednesday showed that factory activity shrank amid the recent Covid outbreak < We need to send Dr. Fauci over to China.
Finance ministers from the G7 nations will hold talks on the Biden administration's proposed price cap on Russian oil on Friday (BBG)
> The U.S. expects that this will lessen pressure on the energy market and cut overall Russian crude revenue
> "Without a price cap," the economy might be threatened by a "global energy price spike," especially if the majority of Russian production is "shut in," according to U.S. Treasury Secretary Yellen
> Russian oil exports fell by 0.115 MMBbl/d in July to 7.4 MMBbl/d, from about 8 MMBbl/d at the start of the year. Total export revenues fell from $21 billion in June to $19 billion in July on both reduced volumes and lower oil prices
The OPEC+ coalition tightened its outlook for the world's oil markets this year and next year, as members struggle to meet their output targets (BBG)
> The bloc's committee of technical experts cut forecasts for this year's global supply growth to 0.400 MMBbl/d (vs. previously 0.800 MMBbl/d)
> Forecasts for 2023 were changed from a surplus of 0.900 MMBbl/d to a deficit of 0.300 MMBbl/d
> The OPEC+ group is scheduled to meet on Monday to discuss production quotas < As shown on page two of yesterday's EPG newsletter, 8 OPEC cartel member countries did not produce up to their quota in July (INCLUDING SAUDI ARABIA). Total production by the cartel in July was 1,130,000 bpd below the quotas.
Natural Gas
The EIA will release its weekly natural gas storage report today, with traders eyeing changes to the storage deficit
> According to the Bloomberg survey, the median estimate is for an injection of 58 Bcf, while the survey ranges from 53-65 Bcf and the five-year average injection is 47 < My SWAG is 60 Bcf.
> Last week saw an injection of 60 Bcf
> Current inventories are 2,579 bcf, 268 Bcf less than this time last year, and 353 Bcf below the five-year average
Texas Railroad Commission adopts new weatherization rules for natural gas infrastructure (BBG)
> Officials from the RRC have voted unanimously to implement new rules requiring critical suppliers of natural gas to implement measures to remain operational during winter storms
> Officials have also amended a rule that designates gas wells as critical infrastructure based on production amount. Gas wells that produce more than 250k cf/d will be considered critical, up from the previous designation of 15k cf/d
> The changes will keep 78% of the state's daily gas production designated as critical infrastructure
> WTI is down $2.00 to $87.55/bbl, and Brent is down $2.07 to $93.57/bbl.
> Natural gas is up 1.6c to $9.143/MMBtu.
AEGIS Notes
Oil
Oil prices tumbled this morning to trade near $87/Bbl
> WTI fell by $2 amid reports of China widening its Covid-19 restrictions
> Meanwhile, China's official manufacturing PMI data released on Wednesday showed that factory activity shrank amid the recent Covid outbreak < We need to send Dr. Fauci over to China.
Finance ministers from the G7 nations will hold talks on the Biden administration's proposed price cap on Russian oil on Friday (BBG)
> The U.S. expects that this will lessen pressure on the energy market and cut overall Russian crude revenue
> "Without a price cap," the economy might be threatened by a "global energy price spike," especially if the majority of Russian production is "shut in," according to U.S. Treasury Secretary Yellen
> Russian oil exports fell by 0.115 MMBbl/d in July to 7.4 MMBbl/d, from about 8 MMBbl/d at the start of the year. Total export revenues fell from $21 billion in June to $19 billion in July on both reduced volumes and lower oil prices
The OPEC+ coalition tightened its outlook for the world's oil markets this year and next year, as members struggle to meet their output targets (BBG)
> The bloc's committee of technical experts cut forecasts for this year's global supply growth to 0.400 MMBbl/d (vs. previously 0.800 MMBbl/d)
> Forecasts for 2023 were changed from a surplus of 0.900 MMBbl/d to a deficit of 0.300 MMBbl/d
> The OPEC+ group is scheduled to meet on Monday to discuss production quotas < As shown on page two of yesterday's EPG newsletter, 8 OPEC cartel member countries did not produce up to their quota in July (INCLUDING SAUDI ARABIA). Total production by the cartel in July was 1,130,000 bpd below the quotas.
Natural Gas
The EIA will release its weekly natural gas storage report today, with traders eyeing changes to the storage deficit
> According to the Bloomberg survey, the median estimate is for an injection of 58 Bcf, while the survey ranges from 53-65 Bcf and the five-year average injection is 47 < My SWAG is 60 Bcf.
> Last week saw an injection of 60 Bcf
> Current inventories are 2,579 bcf, 268 Bcf less than this time last year, and 353 Bcf below the five-year average
Texas Railroad Commission adopts new weatherization rules for natural gas infrastructure (BBG)
> Officials from the RRC have voted unanimously to implement new rules requiring critical suppliers of natural gas to implement measures to remain operational during winter storms
> Officials have also amended a rule that designates gas wells as critical infrastructure based on production amount. Gas wells that produce more than 250k cf/d will be considered critical, up from the previous designation of 15k cf/d
> The changes will keep 78% of the state's daily gas production designated as critical infrastructure