Energy Prospectus

Opening Prices:
> WTI is up $0.76 to $81.20/bbl, and Brent is up $0.85 to $85.48/bbl.
> Natural gas is down -6.3c to $3.431/MMBtu.

AEGIS Notes
Oil

Oil prices were provided a lift in Thursday's pre-market trading alongside the broader financial markets. This comes after the Federal Reserve hinted it might be done with raising rates (BBG)
The Fed refrained from raising borrowing costs for the second time yesterday and that the rise in longer-dated Treasury yields reduces the need to hike again

On the geopolitical front, The Israel-Hamas war remained contained to the two groups
AEGIS notes that from a price perspective, crude has given up its war premium

Enterprise unveils Permian expansion with new projects (P&GJ)
Enterprise announced four major projects by 2025: two gas processing plants, the Bahia NGL pipeline, NGL fractionator 14, and a deisobutanizer in Texas
The company announced that they have begun the steps to return the 210 MBbl/d Seminole Pipeline that ships crude oil, to NGL transportation service in December 2023
Enterprise forecasts a surge in Permian crude oil production, with an increase of 0.7 MMBbl/d in 2023 and an increase of 1.5 MMBbl/d by 2025, estimating over 7.5 MMBbl/d by 2030 < All of the other major U.S. oil producing basins have peaked and are on decline. We will need more oil from the Permian and it would be wise (which is why we the Feds won't do it) to open up more of the Gulf of Mexico and other federal lands).
The company estimates a 700 MBbl/d increase in NGL production for the three-year period ending 2025

AEGIS notes that Permian crude oil capacity to Corpus Christi is over 90% utilization, but plenty of open capacity exists to Houston
Earlier this year, there was about 750 MBbl/d of capacity open to ship from West Texas to the Houston area (RBN)

Natural Gas

Natural gas prices edge lower Thursday after losing 8.1c on Wednesday

The Winter ‘23/’24 strip is down 5.1c this morning at $3.546, and the Summer ’24 strip is down 3.6c at $3.372
The weather models continue to forecast a cooler shift for the next two weeks < It is called "Winter".

Gulfstream LNG gears up with key players for Louisiana project (S&P)
Gulfstream LNG selects Baker Hughes, Honeywell UOP, and Kiewit Group to support its Louisiana LNG project
Baker Hughes to supply liquefaction equipment, Honeywell UOP for gas treatment tech, and Kiewit for construction support
The project, pending FERC approval, aims for a 4 million mt/year capacity from modular trains at a Mississippi River site in Plaquemines Parish
The company expects an operational launch within six years, following DOE export authorization and the ongoing FERC permitting process

Closing Prices:
> Prompt-Month Henry Hub (Dec 23) was down $-0.022 on the day, to settle at $3.472
> Prompt-Month WTI (Dec 23) was up $2.02 on the day, to settle at $82.46

Trading Economics
Oil
"WTI crude futures rose by more than 3% to above $82 per barrel on Thursday as risk appetite was back to markets after recent interest rate decisions from the Fed, and the BoE gave the impression that the central banks are done with the tightening cycle. The BoE kept interest steady but sharply downgraded its growth outlook, and Governor Bailey warned that officials "should not maintain monetary policy restrictively for excessively long. Also, the Fed left rates unchanged but retreated that the recent increase in yields has had a tightening impact on financial conditions. Still, oil prices remained near two-month lows on expectations of lower demand and as markets continued to bet against risks that Israel’s conflict with Gaza could have larger-scale repercussions that impact crude oil supply. Weaker-than-expected manufacturing activity data in the US and China also clouded the demand outlook in two of the world’s largest oil consumers."

Natural Gas
"US natural gas futures fell 2% to $3.4/MMBtu (but DEC23 is now at $3.51 in after-hours trading), due to increased gas production and milder weather, despite record gas flows to LNG export facilities. Natural gas production rose to 106.1 bcfd so far in November, surpassing a record high of 104.2 bcfd in October. Looking ahead, meteorologists anticipate a shift to warmer-than-normal weather from November 4-17. Meanwhile, gas flows to US LNG export facilities rose to an average of 14.8 bcfd so far in November, up from 13.7 bcfd in October and a record 14.0 bcfd in April. At the same time, exports to Mexico have been falling from September’s record, although there are expectations of an increase when New Fortress Energy's plant starts exporting liquefied natural gas. The latest EIA report showed US utilities injected 79 bcf of gas into storage last week, broadly in line with expectations."