Oil & Gas Prices - Nov 7

[dan_s]

Trading Economics:
Oil
WTI crude oil futures added 0.9% to settle at $72.36 per barrel on Thursday, after a 0.4% drop the day before, as markets assessed the impact of Trump’s presidential win and the Federal Reserve’s recent rate cut, amid a pause in US dollar post-election rally.
> Initially, Trump's victory triggered a brief sell-off, pushing oil prices down by over $2, driven by a stronger dollar. However, prices later rebounded.
> The Fed reduced interest rates by 0.25 bps to 4.50%-4.75%, following a larger cut in September.
> Meanwhile, Hurricane Rafael, which hit Cuba with Category 3 winds, is expected to weaken before reaching the US Gulf Coast, limiting potential disruptions to oil production (estimated at 1.55 million barrels per day).
> Downside risks for oil prices include a stronger US dollar and weak demand, while upward pressures could arise from the possibility of stricter sanctions on Iran and Venezuela under Trump's administration, as well as potential conflicts in the Middle East.

Natural Gas
US natural gas futures erased earlier gains to drop below $2.7/MMBtu on Thursday as markets assessed fresh inventory data from the EIA and gauged the impact that Hurricane Rafael may have on natural gas output and consumption.
> The US added 69 billion cubic feet of natural gas to the national inventory on the week ending November 1st. Such an addition extended the 79 bcf build from the earlier week, as hotter autumn has kept gas-intensive heating demand in the Lower 48 states muted.
> In turn, Hurricane Rafael initially drove facilities that are responsible for 7% of US Gulf of Mexico output to shut down halfway through the week, impacting the key region’s supply. In turn, expectations that the hurricane may soften as it approaches US landfall limited bets that power grids will shut down, preventing a drawdown in power demand.

I did see some noise that Iran will attack Israel soon. Natural gas prices need the cold wave in the western U.S. to move eastward.