Oil & Gas Prices - Feb 13
Posted: Mon Feb 13, 2023 10:06 am
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Opening Prices:
> WTI is down $0.71 to $79.01/bbl, and Brent is down $0.72 to $85.67/bbl.
> Natural gas is down -8.0c to $2.434/MMBtu.
AEGIS Notes
Oil
Oil trades lower as the market weighs the impending Russian supply cut against demand recovery
March ’23 WTI lost nearly 70c to trade at around $79/Bbl this morning
The market awaits the January CPI report, which will be released on Tuesday
Flows from Turkey’s Ceyhan port resumed on Monday, the first since the devastating earthquakes in the region on February 6
Production also resumed at Norway’s largest oil field last week after an outage halted 0.5 MMBbl/d of loadings
Russia said on Friday that it would cut output by 0.5 MMBbl/d in March
Concerning global crude supply, UAE Energy Minister Al Mazrouei said there is no need for an early OPEC+ meeting as he believes the crude market is “balanced” (BBG)
A slightly stronger US Dollar weighed on prices this morning
A stronger dollar (DXY Index) can cause foreign buyers of dollar-denominated commodities to pay more for the same amount of goods
OPEC+ does not need to hold extraordinary meetings as the oil market is balanced, according to UAE Energy Minister Sahail Al Mazrouei (Bloomberg)
In October 2022, OPEC+ members decided to maintain their production targets through 2023 after lowering oil output by 2 MMBbl/d
Mazrouei further said that the group intends to continue with this agreement unless " we have something that would shake the market….and we haven’t seen that”
The bloc also indicated to maintain output despite Russia’s plans to cut production by 0.5 MMBbl/d in March
Natural Gas
Natural gas prices are down 3%, around $2.43, in the prompt month
The Summer ’23 seasonal strip is lower by 13c to $2.92, and the Winter ‘23/’24 strip is down 9c to $3.86
Weather forecasts are mixed, with the largest change occurring for the Rockies region where the 6-10 day period warmed by 28.6 °F
Natural gas prices trading below the cost of coal (Reuters)
Natural gas prices have fallen to their lowest level in years, which could lead to increased consumption from the power sector
Falling gas prices should incentivize power producers to run gas-powered generators longer and use less coal
A boost in power-sector demand could reduce the amount of gas injected into storage, balancing the market, according to Reuters
First vessel docks at Freeport LNG since fire (Reuters)
On Friday, an LNG tanker docked at Freeports loading dock and took cargoes of LNG that had been stored in the facility's onsite storage tanks
Freeport has continued to take small volumes of gas, with flows on Monday totaling 0.5 Bcf/d
The increase in gas flows to Freeport have brought total LNG feedgas to its highest level since May, at 13.3 Bcf/d
Opening Prices:
> WTI is down $0.71 to $79.01/bbl, and Brent is down $0.72 to $85.67/bbl.
> Natural gas is down -8.0c to $2.434/MMBtu.
AEGIS Notes
Oil
Oil trades lower as the market weighs the impending Russian supply cut against demand recovery
March ’23 WTI lost nearly 70c to trade at around $79/Bbl this morning
The market awaits the January CPI report, which will be released on Tuesday
Flows from Turkey’s Ceyhan port resumed on Monday, the first since the devastating earthquakes in the region on February 6
Production also resumed at Norway’s largest oil field last week after an outage halted 0.5 MMBbl/d of loadings
Russia said on Friday that it would cut output by 0.5 MMBbl/d in March
Concerning global crude supply, UAE Energy Minister Al Mazrouei said there is no need for an early OPEC+ meeting as he believes the crude market is “balanced” (BBG)
A slightly stronger US Dollar weighed on prices this morning
A stronger dollar (DXY Index) can cause foreign buyers of dollar-denominated commodities to pay more for the same amount of goods
OPEC+ does not need to hold extraordinary meetings as the oil market is balanced, according to UAE Energy Minister Sahail Al Mazrouei (Bloomberg)
In October 2022, OPEC+ members decided to maintain their production targets through 2023 after lowering oil output by 2 MMBbl/d
Mazrouei further said that the group intends to continue with this agreement unless " we have something that would shake the market….and we haven’t seen that”
The bloc also indicated to maintain output despite Russia’s plans to cut production by 0.5 MMBbl/d in March
Natural Gas
Natural gas prices are down 3%, around $2.43, in the prompt month
The Summer ’23 seasonal strip is lower by 13c to $2.92, and the Winter ‘23/’24 strip is down 9c to $3.86
Weather forecasts are mixed, with the largest change occurring for the Rockies region where the 6-10 day period warmed by 28.6 °F
Natural gas prices trading below the cost of coal (Reuters)
Natural gas prices have fallen to their lowest level in years, which could lead to increased consumption from the power sector
Falling gas prices should incentivize power producers to run gas-powered generators longer and use less coal
A boost in power-sector demand could reduce the amount of gas injected into storage, balancing the market, according to Reuters
First vessel docks at Freeport LNG since fire (Reuters)
On Friday, an LNG tanker docked at Freeports loading dock and took cargoes of LNG that had been stored in the facility's onsite storage tanks
Freeport has continued to take small volumes of gas, with flows on Monday totaling 0.5 Bcf/d
The increase in gas flows to Freeport have brought total LNG feedgas to its highest level since May, at 13.3 Bcf/d