Oil is trading higher, around $72.80, after Iran seizes oil tanker in the Middle East
Goldman Sachs noted that shipping through the Red Sea has fallen 900 MMBbl/d, or 15%, since the start of attacks
The US Consumer Price Index increased 3.4% YoY in December, the most in three months, leading to concerns that inflation could remain firm
Iran seizes oil tanker off the coast of Oman (BBG)
In a further escalation of tensions in the Middle East, Iran has captured an oil tanker transporting crude from the Iraqi port of Basrah to Turkey, in a claimed retaliation to the “theft of oil by the US”
Last year, the same tanker was seized by the US for violating Iranian sanctions and forced to offload its 1 MMBbl cargo in the US
This event adds to a series of attacks and escalations along shipping routes in the Middle East, adding a risk premium to crude prices
Saudi oil price cuts entice European buyers (BBG)
European imports of crude from Saudi Arabia are set to increase next month following Saudi’s reduction in selling prices
European refiners had previously complained about high prices of Saudi crude and had reduced buying or requested less oil than they were entitled to
Alternative grades, such as Norway’s Johan Sverdrup, have become more expensive, making Saudi crude more attractive
Natural gas prices trade lower as warm weather is forecast following next week’s cold spell
February ’24 Henry Hub lost 7c this morning to trade around $2.969/MMBtu
The Winter ‘23/’24 strip is down 2.3c to $2.743, and the Summer ’24 strip is down 0.9c to $2.756
The weather model indicates warmer trends for the Rockies and Midwest in the 6-10 day period, followed by above-average temperatures in the 11-15 day period, despite a brief intense cold spell in the Northeast and Southeast
Lower 48 gas production fell to 101.83 Bcf/d, driven by gradual drops in the South Central and Northeast and a sharp decline in the Rockies due to recent freeze-offs (Criterion)
NextDecade plans to reach FID on Rio Grande LNG Train 4 by late 2024 (NGI)
Discussions with potential LNG buyers are underway for Train 4, with a positive FID expected in the second half of 2024. NextDecade has started front-end engineering for the phase with Bechtel Energy
The company reached FID on the facility's first phase in July, securing $18.4 billion in financing with contracts for 92% of its phase one capacity and aims to add 17.6 mmty of export capacity by 2027
The exact capacity for each of Rio Grande's additional trains is undisclosed, but the facility's nameplate capacity stands at 27 mmty
West Texas braces for extreme cold over Permian gas freeze-off risk (S&P)
Mid-January forecast warns of sub-freezing temperatures in West Texas, risking production freeze-offs in the Permian Basin and potential spikes in spot gas prices at Waha
An Arctic air mass from Canada is set to bring this season's coldest weather to the US West Coast, Rockies, and Central Plains, affecting northern Texas
Midland and Odessa in the Permian Basin expect below-freezing nights for 10-12 days, with temperatures dropping to single digits around Jan. 15-16, amid a risk of production declines caused by either voluntary curtailments or wellhead freeze-offs
Waha's spot gas prices rose by 25c to $2.605/MMBtu, the highest since a late October cold spell, driven by increased demand and heating needs
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