Oil is trading slightly higher, around $80, after OPEC extended supply cuts
Speculators have increased their net-long position in WTI futures to the highest level since October, according to CFTC data through last Tuesday
OPEC+ extends output cuts (BBG)
The OPEC+ alliance will extend its supply cuts through the end of June in a move that was primarily in line with expectations by traders and analysts
Russia said it would be strengthening its role by focusing more on production cuts rather than exports
OPEC said that the latest output curbs will be “returned gradually subject to market conditions” after the second quarter
The extension of the supply cuts should help prevent oversupplied conditions in the market
BP to start up offshore operations in Brazil (BBG)
BP is preparing to drill a deepwater well in Brazil in the latest attempt by oil majors to develop the offshore area
Shell and ExxonMobil had previously spent billions attempting to develop the offshore fields but did not find any significant discoveries and, in some cases, returned blocks to Brazil’s oil regulator
Despite this, the region could hold the country’s most productive oil fields
Natural gas prices trade higher following EQT’s production curtailment announcement
April ’24 Henry Hub is up 12.3c this morning to trade around $1.958/MMBtu
The Summer ’24 strip is up 10.8c to $2.423, and the Winter ‘24/’25 strip is up 7.5c to $3.480
Today's Euro Ens forecasts a significant warming shift in the South Central, Rockies, and West, with milder increases in the NE/MW/SE, peaking this week and remaining warm into mid-March
Since Friday, L48 production fell an additional 0.75 Bcf/d across the Northeast, Rockies, and South Central, reducing supply to 100.3 Bcf/d, nearly matching the 2023 injection season's rates (Criterion)
EQT trims gas output in response to warm winter and surging supplies (Bloomberg)
Facing an oversupply and mild weather, EQT reduces its output by 1 bcf/day, or 5%-7% of its quarterly production, leading to a 6.7% rise in Henry Hub futures
This move, cutting 30-40 Bcf through March, mirrors broader industry actions with Chesapeake Energy and Comstock Resources also scaling back production
Furthermore, the production curbs come as Appalachian drilling shows signs of scaling back to address oversupply, with the current price environment reflecting high storage levels and reduced demand
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