Oil & Gas Prices - Oct 1
Posted: Tue Oct 01, 2024 3:29 pm
Trading Economics:
Crude Oil:
WTI crude oil futures surged 3% to above $70 per barrel on Tuesday, after Iran launched a barrage of missiles at Israel, heightening fears of a broader regional conflict in the Middle East.
> Israel's Defense Forces intercepted a large number of missiles and stated that there were no further immediate aerial threats from Iran, allowing people to exit shelters. Tensions in the Middle East have sharply escalated, with Israel intensifying its airstrikes on Hezbollah, the Iran-backed militia, killing its leader, Hassan Nasrallah.
> On Tuesday, Israel sent ground forces into southern Lebanon.
> The extent of the oil market’s reaction will depend on the scope and damage of any Iranian attack, which could dictate Israel's response and further destabilize the region.
> Elsewhere, Libya is preparing to restart its oil production after resolving internal conflicts. Libya produces 1.2 million barrels a day, but production fell to below 450K barrels in August due to political instability.
Natural Gas
U.S. natural gas futures increased to $2.91 per MMBtu, the highest since late-July, driven by supply disruptions in the Gulf of Mexico caused by Hurricane Helene.
> The storm led to the shutdown of approximately 17% of gas production in the region, about 313 million cubic feet per day, which raised concerns about future supply capabilities.
> Additionally, widespread power outages left around 4.6 million homes and businesses in Florida, Georgia, and the Carolinas without electricity, further straining the region's power grid and affecting energy consumption. This disruption adds to existing challenges in the natural gas market, where injection levels into storage have been unusually low due to earlier price declines leading to reduced production.
> However, demand forecasts for the next two weeks were revised lower, partly due to reduced gas usage by power generators, as over 2 million homes and businesses in the Southeast and Midwest remain without power following the storm.
> A new tropical storm is developing in the Caribbean Sea that could move into the Central Gulf of Mexico by the end of this week.
Crude Oil:
WTI crude oil futures surged 3% to above $70 per barrel on Tuesday, after Iran launched a barrage of missiles at Israel, heightening fears of a broader regional conflict in the Middle East.
> Israel's Defense Forces intercepted a large number of missiles and stated that there were no further immediate aerial threats from Iran, allowing people to exit shelters. Tensions in the Middle East have sharply escalated, with Israel intensifying its airstrikes on Hezbollah, the Iran-backed militia, killing its leader, Hassan Nasrallah.
> On Tuesday, Israel sent ground forces into southern Lebanon.
> The extent of the oil market’s reaction will depend on the scope and damage of any Iranian attack, which could dictate Israel's response and further destabilize the region.
> Elsewhere, Libya is preparing to restart its oil production after resolving internal conflicts. Libya produces 1.2 million barrels a day, but production fell to below 450K barrels in August due to political instability.
Natural Gas
U.S. natural gas futures increased to $2.91 per MMBtu, the highest since late-July, driven by supply disruptions in the Gulf of Mexico caused by Hurricane Helene.
> The storm led to the shutdown of approximately 17% of gas production in the region, about 313 million cubic feet per day, which raised concerns about future supply capabilities.
> Additionally, widespread power outages left around 4.6 million homes and businesses in Florida, Georgia, and the Carolinas without electricity, further straining the region's power grid and affecting energy consumption. This disruption adds to existing challenges in the natural gas market, where injection levels into storage have been unusually low due to earlier price declines leading to reduced production.
> However, demand forecasts for the next two weeks were revised lower, partly due to reduced gas usage by power generators, as over 2 million homes and businesses in the Southeast and Midwest remain without power following the storm.
> A new tropical storm is developing in the Caribbean Sea that could move into the Central Gulf of Mexico by the end of this week.