Oil & Energy

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With energy prices skyrocketing coupled with China's clean energy transition strategy to lower emissions Zhejiang province authorities ordered around 160 energy-intensive companies to temporarily halt production.

After Natural gas futures fell under $5.00 in manic trading ahead of EIA reported a build of +76 Bcf of working gas in storage.  With natural gas production in the Gulf of Mexico still shut-in. Output was already trailing consumption with elevated demand from both Europe and Asia for U.S. exports of LNG.

WTI Oil futures volatility continued as storm influence effects linger and EIA reported crude drew -3481kbbl (incl -1476kbbl draw at Cushing)  Crude storage at lows seen in 2018). Gasoline stocks grew +3474kbbl,  Utilization rose  5.4% to 87.6%. Production +500k to 10,600 kbpd.

After Natural gas futures fell under $5.00 in manic trading ahead of EIA reported a build of +76 Bcf of working gas in storage.  With natural gas production in the Gulf of Mexico still shut-in. Output was already trailing consumption with elevated demand from both Europe and Asia for U.S. exports of LNG.

WTI Oil futures volatility continued as storm influence effects linger and EIA reported crude drew -3481kbbl (incl -1476kbbl draw at Cushing)  Crude storage at lows seen in 2018). Gasoline stocks grew +3474kbbl,  Utilization rose  5.4% to 87.6%. Production +500k to 10,600 kbpd.

ConocoPhillips continues to expand in the Permian Basin by purchasing Shell Enterprises' $RDS.A Delaware Basin assets for $9.5 bln in cash. $COP is the largest U.S. based independent exploration and production firm based on production volumes. On Jan. 15, 2021, ConocoPhillips closed the $13 bln acquisition of Concho.

What comes to mind with the current European energy crisis is the unexpected consequences of decision making without thought of possible headwinds. The current crisis has been borne out of what could best be described as ignorant energy and environmental policies. Putting the cart before the horse the issue with populist kneejerk policy.

Crude oil inventories have declined by 440 million barrels of oil so far this year which has erased the inventory built up last year and is ahead of International Energy Agency (IEA) estimates. Morgan Stanley says this suggests the market is more undersupplied than estimated

After Natural gas futures ran over $5.60 EIA reported a build of +83 Bcf of working gas in storage.  With natural gas production in the Gulf of Mexico still shut-in. Output was already trailing consumption with elevated demand from both Europe and Asia for U.S. exports of LNG.

WTI Oil futures volatility continued as storm influence effects and EIA reported crude drew -6422kbbl (incl -1103kbbl draw at Cushing, near lows since Jan 2020). Gasoline stocks drew -1857kbbl,  Utilization barely came on  .2% to 82.2%. Production +100k to 10,100 kbpd.

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