Oil & Gas Prices - Feb 2

[dan_s]

We have a live Oil & Gas Market Update today that starts at 10AM CT. You must register on the EPG website home page to attend the live event.

Opening Prices
> WTI is down $0.39 to $76.02/bbl, and Brent is down $0.55 to $82.29/bbl.
> Natural gas is up 7.4c to $2.542/MMBtu.

AEGIS Notes
Oil

Oil extends losses to trade at a three-week low ahead of Russian oil product ban
March ’23 WTI lost 39c this morning to trade around $76/Bbl
Crude fell $2.46 yesterday after EIA reported a 4.1 MMBbl crude build bringing US crude inventories to the highest since June 2021
Fed Chairman Powell announced a further rate hike of 25 basis points yesterday
On February 5, an EU ban on Russian refined goods is set to go into effect, potentially tightening the global supply

Russia’s oil output was steady in January despite the EU ban and G7 price cap (Bloomberg)
Russian crude production was just 0.08 MMBbl/d lower in January than it was in December, at 10.86 MMBbl/d, according to the Energy Ministry
Russian Prime Minister Novak said that the country's " oil output and exports are stable" and that all efforts were being made to " find new supply chains, markets, and transportation " for their crude
Novak's remarks follow the G7 nations' imposition of price caps against the Urals and the current EU embargo on imports of Russian seaborne crude

EU struggles to agree on a price cap level on Russian oil products (Reuters)
The EU’s member states hope to reach an agreement on a price cap for Russian oil products on Friday after postponing a vote on the issue on Wednesday due to disputes among the member states
Poland and the three Baltic states are still pushing for the caps to be set at lower levels to curb Moscow’s revenues, said EU diplomats
Last week, the European Commission recommended a price cap of $45/Bbl for cheap Russian oil products, such as fuel oil, and a $100/Bbl cap on premium Russian oil products, like diesel
However, IEA chief Fatih Birol reiterated his support for the price caps on Wednesday, saying he didn't expect the proposal to cause major problems or disruption

Natural Gas

Gas prices are trading higher slightly, around $2.54 in the prompt month
Weather forecasts are mixed, with the Lower 48 forecast warming in the first half of the two-week period but cooling in the second half

Outage reported on Enbridge pipeline in British Columbia (Reuters)
Enbridge reported that the T-South section of its BC Pipeline had to be isolated for assessments on Wednesday
The 3.6 Bcf/d pipeline transports natural gas from production sites in northern British Columbia to the border of Washington state, where the gas is imported to the US
Enbridge said that their assessments had been completed, and they are currently repressurizing the pipeline

US LNG exports to Europe fell 5% in January (Reuters)
Gas exports to Europe in January totaled 6.84 million tons, about 5% less than the amount exported in December
Europe’s gas market has been well supplied, reducing the need for buyers to procure additional LNG cargoes
A total of 95 cargoes departed the US in January, 68% of which were shipped to Europe, with the rest being shipped to Asia

[dan_s]

Closing Prices:
> Prompt-Month WTI (Mar 23) was down $-0.53 on the day, to settle at $75.88
> Prompt-Month Henry Hub (Mar 23) was down $-0.012 on the day, to settle at $2.456