Oil & Gas Prices - Nov 28

[dan_s]

Trading Economics at 11:30AM ET

WTI crude futures rose more than 2.5% to over $76.5 per barrel on Tuesday, rebounding from four consecutive sessions of losses, as OPEC+ members continued negotiations over output levels. Saudi Arabia has been urging other members to reduce production quotas to stabilize markets, but no resolution or deal has been reached yet. Originally set for November 26, the meeting was postponed to November 30 due to a disagreement over output quotas involving African producers Nigeria and Angola. Meanwhile, the API report is expected to show a drop of about 2 million barrels in US crude inventories last week. Elsewhere, Kazakhstan's largest oilfields have cut their combined daily oil output by 56%.

US natural gas futures (JAN24) traded around $2.9/MMBtu, close to their lowest in twelve weeks, due to ample storage levels, record production, and lower demand. The US EIA reported a withdrawal of 7 billion cubic feet from gas storage for the week ending November 17, significantly less than the 60 withdrawals during the same week last year and a five-year average decline of 53. At the same time, gas stockpiles in the US are approximately 7% above normal for the week ending November 17. The Energy Information Administration attributes abundant inventories to high natural gas production and warmer-than-average winter weather, leading to reduced demand for heating. Forecasts indicate a 4% decrease in heating degree days compared to the prior 10-year average, translating to a 2% drop in space heating consumption compared to the five-year average. So far in November, average gas output rose to 107.6 billion cubic feet per day, up from a record 104.2 in October.
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At the time of this post:
> WTI JAN24 at $76.69
> HH DEC23 at $2.78 and JAN24 at $2.93