Market Insights > First Look

First Look - Gas remains near multi-year highs

Oil prices rise Thursday morning after three consecutive days of declines
- WTI for April delivery stood at $66.58/Bbl (7:45 am CT)
- Prices dropped earlier due to President Trump’s tariffs on Canada and Mexico, along with OPEC+ confirming production increases for April
- Commodity Trading Advisors (CTAs) contributed to recent selling in Brent futures, following price moves; these traders are likely to reach their maximum short positions in the coming days (Energy Aspects)
  - Brent futures entered oversold territory for the first time since September, signaling that the recent price decline may have been excessive and could indicate a potential market reversal
China's fuel production cuts may impact global oil demand (Bloomberg)
- China’s top economic planner is urging oil refiners to reduce fuel output while boosting chemical production
- Diesel consumption in China has been declining since 2019, and gasoline demand likely peaked in 2023, driven by rising EV sales (Sinopec)
- The shift away from transport fuels could have major implications for China’s refining industry and global crude producers

Natural gas is trading lower, although prices remain near multi-year highs
- The April Henry Hub contract and the Bal ’25 strip as a whole are trading near the highest prices seen since 2022
  - While prices have been lifted across the curve, price action in 2026 and beyond has been more muted
- The EIA is expected to report a -94 Bcf withdrawal from storage today, according to the Bloomberg survey
Expand Energy to defer wells but keep rigs when prices are weak (S&P)
- US gas producer Expand Energy will be responding to price volatility by continuing to drill wells but turning fewer wells to sales rather than reducing drilling activity
- Expand’s COO said, "One of the problems that you run into is the simple fact that as you drop rigs, you're effectively destroying productive capacity," adding that "If you think about the typical commodity price cycles that we have, by the time you start adding your rigs back and restoring production, you're likely peaking your production activity at the peak, and that may be even at the end, of a constructive commodity price cycle,"
- Throughout 2024, Expand built up a capacity of 1 Bcf/d that they can bring online, and between December 2024 and the end of this month, they will increase output by about 600 MMcf/d