Oil & Gas Prices - June 26

[dan_s]

My Q2 forecasts are based on WTI averaging $78 and HH ngas averaging $2.25 during the quarter. These prices compare to Q1 actual prices of $76.11 for WTI and $2.10 for HH ngas.
All of our Canadian upstream companies will also get $5 to $8 per barrel increases in their Western Canada oil sales thanks to much improved differentials due to the opening of the Trans Mountain Pipeline.

WTI crude futures rose above $81 per barrel on Wednesday morning, recouping some losses from the previous session even after industry data pointed to a surprise increase in US crude stockpiles which raised worries about softening demand in the world’s top oil consumer. API data showed that US crude inventories rose by 0.914 million barrels last week, defying market expectations for a 3 million barrel draw. US gasoline stocks also jumped by 3.84 million barrels, compared with forecasts for a 1 million barrel decline. Official data from the US EIA will follow later on Wednesday. Moreover, investors remained cautious ahead of US PCE inflation data this week that could shed light on the path for Federal Reserve interest rate cuts. Meanwhile, oil prices traded close to two-month highs amid heightened geopolitical risks driven by Ukrainian drone attacks on Russian oil infrastructure and failure to secure a peace deal between Israel and Hamas.

US natural gas futures traded around $2.8/MMBtu due to forecasts of hotter weather and increased cooling demand. Meteorologists predict temperatures across the Lower 48 states will stay above normal through at least July 9, which boost the use of gas-powered generators to run air conditioners. Current gas flows to the seven major U.S. LNG export plants remain steady at 12.9 bcfd in June, matching May's figures but below the record 14.7 bcfd set in December 2023. This reduction is due to ongoing maintenance at several Louisiana facilities, including Cameron LNG, Cheniere Energy's Sabine Pass, and Venture Global's Calcasieu Pass. So far this year, gas production is down by around 7% due to delayed well completions and reduced drilling by companies like EQT and Chesapeake after prices fell to 3.5-year lows earlier in the year.