AEGIS Hedging : March 11, 2024

Oil is trading lower, around $77.50, extending losses form last week
- Prices continue to trade in a tight range near $80
BP Whiting refinery could take up to two weeks to restart (BBG)
- Following a power outage in February that led to a shutdown of the facility, the refinery has been slowly returning to full operations
- BP is now saying that they anticipate it will be about two more weeks until the refinery is back to normal operating conditions
- The Whiting refinery receives large volumes of Canadian heavy crude
Crude in floating storage falls 8% (BBG)
- According to Vortexa, the amount of oil being held on the water in floating storage fell to 69.01 MMBbls last week
- The Asia-Pacific region has the largest amount of crude being stored on the water, with 33.98 MMBbls in storage

Natural gas prices trade lower as mild March weather and growing storage surpluses weighed on prices
- April ’24 Henry Hub is down 2.9c this morning to trade around $1.776/MMBtu
- The Summer ’24 strip is down 3.7c to $2.259, and the Winter ‘24/’25 strip is down 3.3c to $3.358
- Today's Euro Ens forecasts colder Rockies/Midwest temperatures, dropping by 32^o F and 21^o F, and leading to below-normal late March temps
- Lower 48 natural gas production remained above 100 Bcf/d, with minor fluctuations and a notable decrease in the South offset by gains in the Northeast (Criterion)
EQT to buy MVP’s owner Equitrans for $5.5 billion (Bloomberg, WSJ)
- EQT Corporation announces merger with Equitrans Midstream, aiming to become America's first large-scale integrated natural gas producer with an initial enterprise value exceeding $35 billion
- The merger includes strategic assets in the Marcellus and Utica regions and shares in the Mountain Valley Pipeline, enhancing control over natural gas production and transportation
- The all-stock transaction is expected to close in Q4 2024, pending regulatory approvals, and is also contingent on FERC authorizing the Mountain Valley Pipeline to commence service
- This merger is projected to offer a low-cost structure and the best risk-adjusted exposure to natural gas prices for investors, capitalizing on over 2,000 miles of pipeline infrastructure

March 11, 2024