Oil is trading lower, reversing gains after rallying above $85
Prompt-month Brent settled in call-skew for the first time since November, indicating increased bullish sentiment in crude oil
US sanctions impede Russian refinery repairs (Reuters)
The withdrawal of western oilfield service companies from Russia is hampering efforts to maintain and repair refineries, especially after recent Ukrainian drone strikes
Russia’s fourth-largest refinery has cut gasoline production by 40% due to a catalytic cracker being out of service without the necessary expertise to repair it
An expert on Russia's energy industry at the Carnegie Endowment for International Peace said, “If the stream of drones continues at this rate and Russian air defenses don't improve, Ukraine will be able to cut Russian refining runs quicker than Russian firms will be able to repair them,"
Trans Mountain expansion expected to start up in May (BBG)
The expansion of the Trans Mountain pipeline is expected to begin service on May 1, after the completion of a particularly difficult segment of the pipe in British Columbia
The company said, “There are several remaining steps, including outstanding approvals from the Canadian Energy Regulator” and that “With the appropriate approvals and completion of remaining construction activity, Trans Mountain will commence transporting crude oil”
The pipeline will increase outbound capacity for Canadian heavy crude by 550 MBbl/d, which should help support differential prices
Natural gas prices trade modestly lower ahead of the storage report
May ’24 Henry Hub is down 0.8c this morning to trade around $1.833/MMBtu
The Summer ’24 strip is down 2.6c to $2.280 and Winter ‘24/’25 strip is down 2.5c to $3.364
Today's Euro Ensemble forecasts a shift to warmer temperatures across all regions, increasing the Lower 48's average by +5o F, aligning with the 10-year normal starting next week through mid-April
Enterprise expands Permian operations with new 300 MMcf/d gas processing plant (P&GJ)
Enterprise announced plans to construct Mentone West 2, a gas processing plant in Texas' Loving County, capable of processing over 300 MMcf/d of natural gas and extracting over 40 MBbl/d of NGLs
AJ Teague, co-CEO, highlighted the Permian Basin's key role, expected to contribute over 90% of domestic NGL production by 2030, driven by advancing extraction techniques
The Mentone West 2 plant is set to start operations in Q2 2026, following the recent startup of Mentone 3 and the ongoing construction of Mentone West 1, expected to begin service in 2H 2025
Alaska looking to secure natural gas supplies with LNG pipeline deal (NGI)
Alaska and Pantheon Resources are in talks to use a proposed LNG pipeline to increase in-state natural gas supplies, aiming for an FID on the Ahpun project by 2025
Alaska, the fourth largest U.S. natural gas producer, primarily reinjects its gas to sustain oil production, facing potential gas shortfalls as reserves in the Cook Inlet Basin decline
However, Alaska's proposed LNG project could transport up to 500 MMcf/d from Ahpun starting in 2029
Despite being fully permitted, the Alaska LNG project, with a 20 mmty capacity, lacks firm investments and offtake agreements
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