Oil is trading higher, around $78.45, after losing more than $1 yesterday
Oil prices moved lower yesterday following commentary by the Federal Reserve implying interest rates may remain higher for longer, leading to strength in the U.S. dollar
Following yesterday's EIA inventory report, US crude storage levels are about 3% below the five-year average
It was reported that Russian crude production for April has exceeded the OPEC+ quota due to “technical reasons”
Shrinking refining margins in China impact trade of Russian oil (BBG)
China is on track to import the lowest volume of Russian ESPO crude since 2021, as refining margins have weakened, and other grades of oil are cheaper
Earlier this year, independent refiners in China had been buying large volumes of ESPO amid a dispute with Iran that resulted in lower volumes of Iranian crude
Weak margins may force some refiners to cut their throughput rates
According to a note from Mysteel Oilchem, independent refiners may operate at 52% of capacity in June, the lowest since May 2022
Natural gas prices trade higher ahead of the storage report
June ’24 Henry Hub is up 2.1c this morning to trade around $2.863/MMBtu
The Summer ’24 strip is up 5.9c to $3.036 and Winter ‘24/’25 strip is up 5.2c to $3.700
Today’s Euro Ensemble indicates a moderate increase in average temperatures across the Lower 48, although they remain below the 10-year average, with early June expected to be warmer (Criterion)
Mountain Valley Pipeline is adjusting its targeted in-service date to early June (S&P Global)
The targeted in-service date was shifted to early June due to the extended construction duration for weld-out, influenced by weather and environmental protection
The 2 Bcf/d pipeline had initially requested FERC authorization for an in-service date by May 23 to be operational before June 1
As of May 21, Mountain Valley Pipeline reported that fewer than 10 welds out of over 51,000 were remaining, with hydro testing 99% done and all compressor stations commissioned and packed with gas
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