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First Look - Tariffs could threaten natural gas market

Crude prices are steady as investors continue looking for clarification of Trump’s trade policy

Donald Trump’s pick for Commerce Secretary said that Canada and Mexico could avoid tariffs if action is taken on immigration and drug trafficking, while officials previously indicated tariffs may begin this weekend
Crude prices have been volatile, influenced by cold weather, sanctions on Russian flows, and concerns about growth in Europe

OPEC+ is planning to hold a joint ministerial committee meeting early next Month
The group already planned to raise crude output starting in April, gradually unwinding previous cuts
The plan to unwind those cuts has been delayed several times due to weak demand

A Scottish court has blocked production sites being developed in British waters until climate impact can be assessed
The future of these projects has big implications for the UK, with the North Sea aging and major developments dwindling

March natural gas was down 3c to $3.13/MMBtu on its first day as the prompt contract
- Market participants are readying for likely draw in storage of over 300 Bcf to be reported this morning
- The EIA has reported a draw greater than 300 Bcf only three other times
- Warmer and more “normal” weather for February has kept pressure on gas prices as of late
Potential U.S. Tariffs on Canada & Mexico Threaten North American Gas Markets (NGI)
- President Trump’s proposed 25% tariffs on imports from Canada and Mexico could disrupt natural gas flows, raising prices and affecting supply dynamics across North America
- Analysts suggest the tariffs may be a negotiation tactic rather than a certainty, but market volatility and inflation fears could delay Federal Reserve interest rate cuts, affecting energy project financing
- Mexican President Claudia Sheinbaum promises retaliation tariffs
- Canada has few options on gas: They could either keep flowing it south or inject it into storage and or reduce supply.
  - Reducing supply or pushing into storage would be bullish for Henry Hub as less gas would enter the US