Oil & Gas Prices - May 24

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dan_s
Posts: 34964
Joined: Fri Apr 23, 2010 8:22 am

Oil & Gas Prices - May 24

Post by dan_s »

Opening Prices:
> WTI is up $1.07 to $73.98/bbl, and Brent is up $1.04 to $77.88/bbl.
> Natural gas is up 5.5c to $2.376/MMBtu.

AEGIS Notes
Oil

Oil advances the three-day rally following Saudi warning, expected supply tightness
> June ’23 WTI gained nearly $1 this morning to trade around $74/Bbl
> Prices found support following Saudi Energy Minister’s hint at potential further cuts in the June OPEC+ meeting (BBG)

NYMEX gasoline cracks strengthened, supported by the forthcoming summer driving season, and reported outages at U.S. refineries

Equities weakened, while the dollar rose as markets await the outcome of debt ceiling talks before the Treasury's deadline on June 1

API estimates from yesterday indicate significant draws in gasoline and crude reserves by 6.4 MMBbl and 6.8 MMBbl, respectively
Additionally, U.S. Fed’s FOMC meeting minutes are due for release today, potentially offering insights into future rate hikes

Western Canada’s wildfires recede; some oil and gas production resumes (BBG)
> Fires have dropped from 93 to 71, with those uncontrolled down from 26 to 20
> Chevron has resumed some operations in the Kaybob Duvernay shale area, while NuVista Energy has reinstated the majority of its halted 0.035 MMBbl/d production < Crescent Point and ROK Resources have producing wells in the Kaybob area.
> Due to wildfires and maintenance, Alberta's crude production is down by 0.24 - 0.28 MMBbl/d, potentially reaching a 0.48 MMBbl/d drop in May, according to ESAI consultancy

Natural Gas

Natural gas prices are trading higher, around $2.36, reversing losses from yesterday
Weather forecast changes were mixed, with the South Central regions forecast shifting warmer by 16.3 °F over the two-week period and the Northeast regions forecast shifting cooler by 10.9 °F
Canadian imports of natural gas have rebounded from 4-Bcf/d to 5-Bcf/d as wildfire impacts decline

Energy Transfer requests rehearing after DOE denies LNG extension (Reuters)
The Department of Energy denied ET’s request for an extension of its planned Lake Charles LNG project, resulting in one customer suspending contract discussions
The company said, "Lake Charles LNG is the most advanced LNG project in the United States that has not taken FID, and we believe it satisfies the criteria for an extension,"
ET said the need for a three-year extension is due to unplanned delays and severe equipment shortages, and with an extension, they could secure an FID by the end of the year

Philippines increases LNG imports as domestic gas supply falls (Reuters)
The country’s primary gas field, which supplies 13% of the country’s gas, is expected to decline significantly in the next four years resulting in the need to import LNG for the power sector
The country will require about 146 Bcf per year to sustain its natural gas power plants
Demand from emerging market countries will likely continue to keep the global demand for LNG high, incentivizing US export plants to run at full capacity
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34964
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - May 24

Post by dan_s »

Trading Economics
WTI crude futures jumped toward $74 per barrel on Wednesday, rising for the third straight session to the highest levels in three weeks, as a warning from the Saudi energy minister stoked fears of further OPEC+ production cuts. Saudi Arabia’s Prince Abdulaziz bin Salman told speculators to “watch out,” in what analysts took as a signal that OPEC+ could consider further output cuts at a meeting on June 4. Meanwhile, industry data showed that US crude inventories declined by about 6.8 million barrels last week, defying forecasts for a 0.525 million increase. Gasoline inventories also dropped by about 6.4 million, while distillate inventories fell by about 1.8 million. Those data came ahead of the Memorial day holiday which traditionally marks the beginning of US peak summer travel. Elsewhere, investors continued to monitor debt ceiling negotiations in the US as there have been few indicators of progress being made even as the risk of default estimated in early June looms.
Dan Steffens
Energy Prospectus Group
dan_s
Posts: 34964
Joined: Fri Apr 23, 2010 8:22 am

Re: Oil & Gas Prices - May 24

Post by dan_s »

Closing Prices:
> Prompt-Month WTI (Jul 23) was up $1.43 on the day, to settle at $74.34
> Prompt-Month Henry Hub (Jun 23) was up $0.077 on the day, to settle at $2.398
Dan Steffens
Energy Prospectus Group
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