Oil trades lower, reversing some gains from yesterday
The API estimates that US crude inventories increased by 7.17 MMBbls last week
BP expects a slow restart of Whiting refinery (BBG)
The largest inland refinery in the US was shut on February 1 following a power loss and remains partially offline
BP now says they expect the refinery to return to normal by March 1 if no further issues occur
The crack spread, which measures refinery margins, has increased 20% from the time of the incident, while regional gasoline inventories have drawn down
The shutdown has also weakened demand for Canadian heavy crude, which the refinery receives large volumes of
Disrupted Russian oil flow hits Indian refinery margins (BBG)
Russian oil has become more expensive for refiners in India, squeezing profit margins
Tougher sanctions have stranded some Russian cargoes, while attacks in the Red Sea have driven freight rates higher
Exports of fuels from India to Europe averaged 18 MBbl/d in the first two weeks of February, down 90% from January
Natural gas prices trade lower amid weak weather outlook
March ’24 Henry Hub is down 8.2c this morning to trade around $1.691/MMBtu
The Summer ’24 strip is down 5.5c to $2.230, and the Winter ‘24/’25 strip is down 3.4c to $3.313
Today's Euro Ens indicates a moderate +1.6° F warming across the Lower 48, with significant regional shifts—cooler in the South Central/Southeast, warmer in the Midwest/Rockies/West
Over the past three days, lower 48 natural gas production fell by 1.08 Bcf/d, to 102.7 Bcf/d, with reductions in the Rockies and Northeast, while South Central remained unchanged (Criterion)
North Dakota natural gas prices hit 28-year low, highlighting takeaway constraints (NGI)
Natural gas prices in North Dakota's Bakken Shale have dropped to a 28-year low at $1.17/Mcf amid takeaway bottlenecks
Addressing the issue, Department of Mineral Resources (DMR) Director Lynn Helms said that upcoming projects, like electric fracturing and a new 580 MW gas-fired power plant, are set to increase in-basin demand for natural gas
Additionally, Hess Midstream plans to add 125 MMcf/d gas processing capacity by 2027 aims to relieve some infrastructure constraints
With natural gas production averaging 3.52 Bcf/d in December versus 3.47 Bcf/d in November and a 95% capture rate, Helms is optimistic about transporting more gas to markets in the south and west
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