Energy Prospectus

Opening Prices:
> WTI is down $0.01 to $74.14/bbl, and Brent is up $0.02 to $78.52/bbl. < Up $1.16 to $75.31 by 9:10AM CT
> Natural gas is up 9.3c to $2.605/MMBtu.

AEGIS Notes
Oil

Oil steady as seaborne Russian crude exports decline
August ’23 WTI lost 1c this morning to trade around $74.14/Bbl
Equities trade higher, while the dollar continues to trade at its lowest since April 2022
As of July 16, the four-week average of seaborne exports of Russian crude declined by 0.1 MMBbl/d to reach 3.1 MMBbl/d
Weaker-than-expected Chinese economic growth and Libyan oil production resumption weigh on prices

Seaborne Russian crude exports plummet to a six-month low (BBG)
Seaborne crude exports for the week ending July 9 dropped to 3.2 MMBbl/d, down 0.78 MMBbl/d from the peak in May and 0.27 MMBbl/d below February's baseline
Additionally, Russia plans to curb 0.5 MMBbl/d of crude exports in August
Furthermore, the export duty companies pay to the Russian state will be raised to the highest level in 2023 for August ($16.9/ton, up 8.3% from July), helping to partly offset the impact of production cuts

Natural Gas

Natural gas prices are up 3.75% to $2.61 as weather models shift warmer
The Winter ‘23/’24 strip is up 3.6c to $3.48, and the Summer ’24 strip is trading 2.2c higher to $3.28
Weather forecasts shifted warmer, mostly in the Midwest, with the region’s forecast warming by 8.7 °F

Natural gas storage injections outpacing the five-year average (EIA)
Injections into underground storage since April 1 have exceeded the five-year average by 6% or 66-Bcf, with storage facilities now filled to 69% of capacity
High levels of storage have pressured gas prices lower this year after 2022’s storage deficit led prices to rise to more than $9/MMBtu
The EIA projects that injections into storage will slow due to flat production and higher levels of gas usage by the power sector, although they still forecast inventories to remain above the five-year average for the remainder of the year

LNG Canada receives its final liquefaction module
Engineering and construction company Fluor announced that “The final module shipped from its fabrication yard in Zhuhai, China, arrived yesterday morning at the LNG Canada project in Kitimat”
A total of 215 modules of various sizes have been delivered
The facility is expected to begin shipments in 2025 and have a capacity of 1.87-Bcf/d

If you hold any gassers, read this: https://seekingalpha.com/article/4617666-natural-gas-stocks-comparing-large-us-producers

Trading Economics:
"WTI crude futures rose above $75 per barrel on Tuesday, recovering from two straight sessions of losses amid signs of tightening US oil supplies. Data from the Energy Information Administration showed US shale oil production is expected to drop to nearly 9.4 million barrels per day in August, the first such decline since December. Meanwhile, oil prices lost nearly 2% in the previous session as weaker Chinese economic growth raised concerns about demand in the world’s top crude importer. The country’s economy grew by a lower-than-expected 6.3% in the second quarter amid slowing demand from both domestic and international sources. Additionally, two of the three Libyan oil fields shut last week resumed production on Saturday evening, bringing a total output capacity of 370,000 barrels per day back to the market."

Most people still believe that:
> Wind, Solar and EVs will cause global oil demand to fall. This is an incredibly FALSE PARADIGM.
> That U.S. shale oil production can keep increasing year after year. The Permian Basin cannot grow fast enough to offset declines in other basins and conventional oil production is on steady decline. Plus, the Permian Basin is probably going to reach peak production within two year.

Closing Prices:
> Prompt-Month WTI (Aug 23) was up $1.60 on the day, to settle at $75.75
> Prompt-Month Henry Hub (Aug 23) was up $0.117 on the day, to settle at $2.629