Market Insights > First Look

First Look - OPEC sticks with plan to return supply

Oil is trading higher, extending gains from yesterday
- Tensions in the Middle East continue to rise, with Iran having ordered a retaliatory strike on Israel in response to the killing of a top Hamas leader in Tehran
- Call option volumes have increased further, with some near term expiry’s now in call skew, which is rarely seen in oil
OPEC+ sticks with plan to return supply (BBG)
- At a monitoring meeting, OPEC+ signaled no changes to their plan to gradually return supplies to the market starting next quarter
- Over the course of the fourth quarter, about 540 MBbl/d of production is set to come back, depending on market conditions
- If demand in Asia does not pick up as OPEC expects, the group may find it difficult to return supply without leading to oversupplied conditions in the market

Natural gas prices are higher, reversing losses from yesterday
- Weather forecasts indicate Lower 48 average temperatures will be higher than the 10-year average for the next week before falling below normal again
- Production is lower today, coming in at 100.37 Bcf/d
- LNG Canada is set to receive a cargo of refrigerants in early August as the facility prepares to startup this year and ship cargoes by mid-2025
Environmental groups press FERC to rethink LNG project (S&P)
- Opponents of Venture Global’s CP2 LNG export project are asking FERC to reconsider its authorization
- The project has faced continued opposition from groups who specifically targeted the project in the lead-up to the Biden administration’s decision to pause LNG export approval permits