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First Look - Gas trades higher, driven by lower production and expectations of a shrinking inventory surplus

Oil trades lower despite an increase in Middle East tensions
- Yesterday, thousands of Hezbollah members were injured or killed in an Israeli attack through sabotaged pagers
  - The incident has raised fears of further escalation in the region
- The Federal Reserve will announce its interest rate decision today
DOE to purchase additional crude for SPR (PGJ)
- The Biden administration will seek up to 6 million barrels of oil for the Strategic Petroleum Reserve
- The U.S. will buy the oil for delivery to the Bayou Choctaw site in Louisiana in early 2025
- The reserve currently holds 380 million barrels, having repurchased over 50 million barrels since the 2022 sale
South Sudan ready to resume oil exports through Sudan (PGJ)
- South Sudan's crude oil exports through a Sudanese pipeline were halted in February due to wartime damage
- South Sudan had been exporting about 150,000 barrels per day through Sudan before the disruptions
- Repairs have been completed, and engineers are currently assessing and restarting operations

Gas trades higher, buoyed by lower production and expectations of continued shrinkage in the inventory surplus
- Prompt gas was 4.4c higher to $2.368/MMBtu (As of 7:45 AM)
- Winter ‘24/’25 strip is up 2.9c to $3.046, and the Summer ’25 strip is down 2.2c to $3.057
- Producers continue to restrain output to tighten the supply/demand balance, with Wood Mackenzie estimating production at 99.4 Bcf, slightly below the 100.4 Bcf seven-day average (NGI)
- Today's European Ensemble shifted 6 F colder, especially in the Northeast, Rockies, and West, with changes primarily in the 6-10 day period, though the overall pattern remains consistent with cooler temps into early October (Criterion)
US Gulf of Mexico oil, gas output gradually resumes after Hurricane Francine (S&P Global)
- About 12% or 213 MBbl/d of oil production and 16% or 298 MMcf/d of natural gas remained offline in the Gulf as of Sept 16, compared to higher shutdown rates on Sept 15
- Twenty four platforms, or 6.5% of the total, remained evacuated, down from 37 platforms (10%) the previous day, according to US BSEE
- Chevron redeployed crews and resumed production, reporting no significant damage to its facilities, while Shell is ramping up production at Perdido but still faces issues at Auger and Enchilada/Salsa