EIA reported a net build of +104 Bcf from storage, which included a reclassification of 14 Bcf in the Nonsalt South Central region for the week ending June 2, 2023. The implied flow of +118 Bcf which was near consensus. In the same week last year stocks were +99Bcf, with a five-year (2017-2021) average +105Bcf. Salt Dome Cavern stocks rose +15 Bcf after rising +10 Bcf last week. Natural gas futures found support this week with June heat demand. Coming … Continue reading “Into the Vortex – EIA Reported U.S. Natural Gas Storage Rose 118 Bcf Last Week”
Around The Barrel – US Oil Production Rises to 2020 Levels, as OPEC Cuts Again
EIA reported a US crude oil inventories fell +0.451Mbbls, which included -1.900Mbbls taken from the SPR in the tenth street week of SPR drawdowns. Domestic US oil production rose to the highest level since 2020 to 12.4mbpd in weekly. This was in line with EIA STEO forecasts yesterday. The WTI Futures Hub at Cushing had a build of 1.721Mbbls. Gasoline grew +2.746Mbbls and Distillate grew +5.075Mbbs in inventories. Refinery utilization rose +2.70% with the Memorial Day weekend demand. Baker Hughes … Continue reading “Around The Barrel – US Oil Production Rises to 2020 Levels, as OPEC Cuts Again”
EIA Sees Brent Higher but Forecast Non-OPEC Growth will Offset OPEC+ Production Cuts
In the June STEO, EIA forecast that despite the extension of OPEC+ production cuts, global liquid fuels production will increase by 1.5 million b/d in 2023 and by 1.3 million b/d in 2024, primarily because of growth from non-OPEC producers. EIA also raised its 2023 world oil demand growth forecast by 30Kbpd, seeing an increase of 1.59m bpd this year. However, the EIA lowered next year’s demand forecast by 20Kbpd to a 1.70 mbpd increase. They see most of this … Continue reading “EIA Sees Brent Higher but Forecast Non-OPEC Growth will Offset OPEC+ Production Cuts”
Sea Freight Indices Slide Accelerates, BDI Down 21.6% for The Week, Lowest Since Jan 6
The Baltic Exchange’s dry bulk sea freight index fall worsened, now falling for sixteen straight days on Friday, its lowest level since January 6. The benchmark index fell about 21.6% this week with all four major segments of the BDI continuing to weaken. The Capesize 5TC was again the heaviest hit, sinking another 33%, after falling 20% the week prior with diminishing demand amid reduced production by Chinese steelmakers. The Panamax 5TC slid its lowest since February 22 and the … Continue reading “Sea Freight Indices Slide Accelerates, BDI Down 21.6% for The Week, Lowest Since Jan 6”
Into the Maelstrom – LNG and European Natural Gas Outlook for the Week Ahead
Natural gas prices continued lower in Europe and the UK as did LNG futures in the past week. Dutch benchmark natural gas futures fell below €24 per megawatt hour to start June at fresh two-year lows, following a 30% drop in May. The same catalysts overhang, fast LNG send out, gas stockpiles, weak demand, mild weather conditions, stronger renewable power generation and subdued demand from Asia have steadily weighed on prices. European economy remains weak with Germany experiencing a recession … Continue reading “Into the Maelstrom – LNG and European Natural Gas Outlook for the Week Ahead”
Brent Crude Contract Revamp Adds Midland Reflecting Texan Oil Dominance
The long-awaited revamp of the Brent futures contract took place on Thursday. The Brent contract, a construct of Oil-index publisher Platts added U.S. WTI Midland crude oil transactions into the Platts dated Brent price assessment from June 2023 cargo deliveries. This was the first inclusion of a non-North Sea crude oil into the Brent basket. Eyes have now shifted from the North Sea to Texas. With deliveries that arrive Thursday on Midland prices will be included in the global pricing … Continue reading “Brent Crude Contract Revamp Adds Midland Reflecting Texan Oil Dominance”
Into the Vortex – EIA Reports U.S. Natural Gas Storage Increased 110Bcf Last Week
Natural gas futures continued to sell off, down another 4.3% on the day and down 12.49% for the week after EIA reported an above consensus net build of +110 Bcf from storage last week. In the same week last year stocks were +82Bcf, with a five-year (2017-2021) average +101Bcf. Salt Dome Cavern stocks rose +10 Bcf after rising +4 Bcf last week. Natural gas prices in Europe and the UK continued to slide as did LNG futures in the past … Continue reading “Into the Vortex – EIA Reports U.S. Natural Gas Storage Increased 110Bcf Last Week”
Central Bank Watch – Resilient Demand and Inflation Data Confusing Bankers and Analysts
The bond market is turning nervous as we continue to see bond and currency markets roiled by renewed debt ceiling theatrics and more data this week (PCE, GDP Price Index, Services PMI, Personal Income and Spending, Jobless Claims) pointing to resilient demand and inflation. The futures market is now pricing in a 69% probability of a 25-bps hike on June 14th, with peak Fed funds now at 5.33% for the July 26th meeting. Higher for longer is the pricing, the … Continue reading “Central Bank Watch – Resilient Demand and Inflation Data Confusing Bankers and Analysts”
Into the Maelstrom – LNG and European Natural Gas Outlook for the Week Ahead
Natural gas prices in Europe and the UK continued to slide as did LNG futures in the past week. Fast LNG send out, gas stockpiles and weak demand have steadily weighed on prices. European benchmark Dutch TTF prompt natural gas futures traded at €24.52/MWh Friday continuing its slide under €30/MWh after closing €29.30/MWh Monday, its lowest for any day since 17 June 2021. TTF is down 18.74% for the week, UK gas down 16.09%. In comparison the US benchmark HH … Continue reading “Into the Maelstrom – LNG and European Natural Gas Outlook for the Week Ahead”
Sea Freight Indices Slide Continues; Capesize Sank 20%, BDI Off 15%, Supramax Down 12.3% Panamax Falls 8.4% – TC Shipping Monitor
The morose global economy has seen the Baltic Exchange’s dry bulk sea freight index continue to fall, now for a twelfth straight day on Friday, its lowest level since March 2nd. All major segments of the dry bulk spot lower as shipping continued to grapple with a China reopening sputtering at best. The BDI was down nearly 15%, its worst week in nearly four months. The Capesize 5TC sank 20%, with diminishing demand amid reduced production by Chinese steelmakers. The … Continue reading “Sea Freight Indices Slide Continues; Capesize Sank 20%, BDI Off 15%, Supramax Down 12.3% Panamax Falls 8.4% – TC Shipping Monitor”