Oil is trading down, around $77.40, extending losses from yesterday
The US Dollar is trading sharply higher this morning, which often has a bearish impact on crude prices
Timespreads have softened, with the WTI prompt spread the weakest in several weeks
Iraq continues to produce more than quota (BBG)
OPEC’s production cuts have stalled as Iraq has continued to produce more than it has agreed to
Iraq reduced output in February by 14 MBbl/d to an average of 4.2 MMBbl/d, which is 200 MBbl/d more than its quota
OPEC countries overproducing their quotas is a bearish risk for crude prices in 2024
OPEC continues to forecast strong demand (Reuters)
In its latest report, OPEC stuck with its forecast for oil demand in 2024 and 2025 while raising its forecast for economic growth
OPEC has forecast stronger demand growth than many other forecasters, such as the IEA
On the matter of stronger economic activity, OPEC said, "While some downside risks persist, a continuation of the expected momentum from the beginning of the year could result in additional upside potential for global economic growth in 2024."
Russian energy infrastructure hit in drone attack (BBG)
Refineries and oil export facilities in Russia continue to face attacks by Ukrainian drones, threatening a recovery in refining capacity after a previous drone attack took some facilities offline
Earlier in the year, Russian product exports fell sharply as a result of an attack, which could be an ongoing theme if the drone attacks continue
Natural gas prices trade higher amid lower production
April ’24 Henry Hub is up 4.7c this morning to trade around $1.806/MMBtu
The Summer ’24 strip is up 3.1c to $2.280, and the Winter ‘24/’25 strip is up 1.4c to $3.372
Today's Euro Ens forecasts a 13o F warmer shift in the South Central, offset by a broader shift to cooler, below-normal temperatures across the Lower 48
Lower 48 natural gas production rose to 100.6 Bcf/d with late nominations, but early-cycle declines brought it down to 99.35 Bcf/d, driven by drops in Appalachia and South Central, including maintenance in the Permian Basin (Criterion)
Natural gas producer CNX delays production, forecasts lower volumes amid weak gas prices (Reuters)
CNX Resources reduces 2024 production volume forecast to 540-560 Bcfe, marking about a 30 Bcfe decrease from its earlier projections amidst the current oversupplied market conditions and declining gas prices
Specifically, the company plans to postpone completion activities on three upcoming pads in the Marcellus Shale, encompassing 11 wells
Furthermore, CNX has adjusted its 2024 capital expenditure forecast to $525-575 million, indicating a $50 million cut from the midpoint of its prior forecast
The company, however, maintains the flexibility to return to its previously stated long-term production volume target of nearly 580 Bcfe in 2025
Golden Pass, Delfin take final capacity for Kinder Morgan’s Texas-Louisiana expansion project (NGI)
Kinder Morgan's Texas-Louisiana Expansion project is fully subscribed with Golden Pass and Delfin LNG signing agreements for the remaining 130 MMcf/d of capacity, aiming for completion by July 2026
The $72 million expansion will enhance NGPL system capacity by 300 MMcf/d, leveraging natural gas from Eagle Ford, Haynesville, and the Permian Basin
Golden Pass LNG and Delfin Midstream secured capacities of 50 MMcf/d and 80 MMcf/d, respectively; Golden Pass is set to start exports in 2025, while Delfin seeks an export authorization extension
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