Oil is trading lower, around $76, extending losses from yesterday
Holdings in ETFs that track oil prices have fallen to the lowest level since late 2022 as investors have pulled money from the products
Russia has been shipping some Urals oil to Venezuela as it looks to expand its number of buyers
Goldman Sachs says the physical oil market is showing signs of strength (BBG)
Timespreads have widened for many light and medium crude grades, which could imply a tighter physical market
Prompt spreads in WTI Midland, WTI Cushing, and Mars have widened over the past week, along with stronger prices in several crude basis locations
However, Goldman says the outlook remains mixed as higher Chinese demand has mostly been countered by higher exports from OPEC countries last week
China buys Russian crude as Indian buyers turn away (BBG)
Chinese refiners have increased purchases of Russia’s Sokol crude grade, as Indian buyers have shunned it due to sanctions concerns
Refiners have received an average of 168 MBbl/d so far this month, three times more than in January
China and India have been the largest buyers of Russian crude following the US-led sanctions, but issues in recent months have appeared between India and Russia over oil purchases
Natural gas prices rebound after Chesapeake signals production cuts
March ’24 Henry Hub is up 19.7c this morning to trade around $1.773/MMBtu
The Summer ’24 strip is up 12.7c to $2.290, and the Winter ‘24/’25 strip is up 6.3c to $3.358
Today's Euro Ens forecasts warmer temperatures across all regions, with some hope for milder weather in the 11-15 day period
Lower 48 natural gas production fell 0.85 Bcf/d, primarily in Appalachia, to 103.2 Bcf/d, driven by a holiday-delayed decrease (Criterion)
Chesapeake scales back activity, projecting gas production drop to 2.54 Bcf/d in 2Q-4Q24 (Chesapeake, Criterion)
Chesapeake plans a 20% reduction in annual spending for 2024 to $1.25-$1.35 billion, attributing the cut to lower rig counts, deferred completions, and turn-in-lines in Appalachia and Haynesville
The company will reduce its operations by dropping one rig and one frac crew in each play by midyear, aiming to build a short-cycle, capital-efficient capacity of 1 Bcf/d for future demand
Chesapeake's production is also expected to decrease from 4Q 2023’s 3.43 Bcf/d to 3.15 Bcf/d in 1Q 2024 and is projected to average at 2.54 Bcf/d from 2Q to 4Q 2024
Furthermore, the company has hedged 60% of its 2024 gas output, employing a "hedge the wedge" strategy with floor prices ranging from $1.80/MMBtu in 2Q 2024 to $2.79/MMBtu in later quarters
Equitrans delays Mountain Valley Pipeline to 2Q 2024 (Equitrans, Criterion)
Equitrans delayed the 2 Bcf/d Mountain Valley Pipeline startup from late 1Q 2024 to 2Q 2024, with completion targeted by May 31, 2024, due to unforeseen construction challenges and severe winter weather
The pipeline's commissioning, expected to take about a month, will start in April, following construction work in March, with gas flow to the third compressor expected in March
The company said that the1.6 Bcf/d Hammerhead Gathering Pipeline will supply the MVP, featuring a 1.2 Bcf/d firm commitment from EQT over a 20-year term starting with MVP's service commencement
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