Oil & Gas Prices - Nov 1
Posted: Wed Nov 01, 2023 9:42 am
Opening Prices:
> WTI is up $2.08 to $83.10/bbl, and Brent is up $1.98 to $87.00/bbl.
> Natural gas is down -10.6c to $3.469/MMBtu.
AEGIS Notes
Oil
Oil prices moved $2/Bbl higher Wednesday morning after slumping the first two days of the week
Headlines continue to push crude around in the near-term. < More than normal volatility is expected to continue as long as the War in Israel continues, which is likely to last at least six months.
This morning’s rally is likely off the backs of extra war premium following the Israeli bombing of a refugee camp
The stike on the camp came as Israel targeted a senior Hamas commander who was reportedly in a tunnel network beneath the camp
AEGIS notes that events that traders believe can cause further escalation in the region have jolted oil in the past three weeks
Tanker rates soar as congestion builds at the Panama Canal (Bloomberg)
A drought in Panama has slowed canal shipping, forcing authorities to constrain traffic
The cost to haul propane through the canal has surged – Rates to hire a VLGC from Houston-to-Japan reached a record $250 per ton as of Sept. 29, the highest level since prices were first published in 2016 (EIA)
One LPG carrier paid $2.85 million for the right to skip the line on Nov. 6, according to Flex LNG
The reduction in traffic is expected to last until at least February
Natural Gas
Natural gas prices pulled back Wednesday morning after an impressive 22c rally on Tuesday
The December Henry Hub contract surged to 22c $3.57/MMBtu yesterday
The balance of the Winter ’23-’24 strip rose even more than the prompt-month on Tuesday with a +26c move to $3.677 < If these prices hold it will be bullish for our gassers. My 2024 forecast are based on HH gas prices averaging $3.25 for the year with $3.25 in Q1, $2.75 in Q2, $3.25 in Q3 and $3.75 in Q4.
AEGIS notes that while the weather models showed a cooler shift across the next two weeks from Monday to Tuesday, trade flow was likely a big contributor to yesterday’s magnitude
US LNG feedgas demand has been nearing previous all-time highs
The US LNG fleet consumed 14.6 Bcf/d in morning nominations, only 0.2 Bcf/d lower than the record of 14.88 Bcf/d set back in April
LNG facilities on the Gulf Coast have been able to run at higher rates as temperatures have cooled
The hot weather in summer on the coast can cost an LNG facility up to 25% of efficiency
AEGIS notes that most analysts estimate that new LNG export facilities in the US are not expected until late 2024 < Exxon's Golden Pass is expected online in Q3.
> WTI is up $2.08 to $83.10/bbl, and Brent is up $1.98 to $87.00/bbl.
> Natural gas is down -10.6c to $3.469/MMBtu.
AEGIS Notes
Oil
Oil prices moved $2/Bbl higher Wednesday morning after slumping the first two days of the week
Headlines continue to push crude around in the near-term. < More than normal volatility is expected to continue as long as the War in Israel continues, which is likely to last at least six months.
This morning’s rally is likely off the backs of extra war premium following the Israeli bombing of a refugee camp
The stike on the camp came as Israel targeted a senior Hamas commander who was reportedly in a tunnel network beneath the camp
AEGIS notes that events that traders believe can cause further escalation in the region have jolted oil in the past three weeks
Tanker rates soar as congestion builds at the Panama Canal (Bloomberg)
A drought in Panama has slowed canal shipping, forcing authorities to constrain traffic
The cost to haul propane through the canal has surged – Rates to hire a VLGC from Houston-to-Japan reached a record $250 per ton as of Sept. 29, the highest level since prices were first published in 2016 (EIA)
One LPG carrier paid $2.85 million for the right to skip the line on Nov. 6, according to Flex LNG
The reduction in traffic is expected to last until at least February
Natural Gas
Natural gas prices pulled back Wednesday morning after an impressive 22c rally on Tuesday
The December Henry Hub contract surged to 22c $3.57/MMBtu yesterday
The balance of the Winter ’23-’24 strip rose even more than the prompt-month on Tuesday with a +26c move to $3.677 < If these prices hold it will be bullish for our gassers. My 2024 forecast are based on HH gas prices averaging $3.25 for the year with $3.25 in Q1, $2.75 in Q2, $3.25 in Q3 and $3.75 in Q4.
AEGIS notes that while the weather models showed a cooler shift across the next two weeks from Monday to Tuesday, trade flow was likely a big contributor to yesterday’s magnitude
US LNG feedgas demand has been nearing previous all-time highs
The US LNG fleet consumed 14.6 Bcf/d in morning nominations, only 0.2 Bcf/d lower than the record of 14.88 Bcf/d set back in April
LNG facilities on the Gulf Coast have been able to run at higher rates as temperatures have cooled
The hot weather in summer on the coast can cost an LNG facility up to 25% of efficiency
AEGIS notes that most analysts estimate that new LNG export facilities in the US are not expected until late 2024 < Exxon's Golden Pass is expected online in Q3.