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First Look - Natural gas prices continue to trend lower

Crude rises as market weighs OPEC+ supply outlook, US-China trade friction
- WTI prompt-month contract climbed 85c to $63.12/Bbl on Thursday morning (7:45 AM CT)
- Despite signs of easing, China pushed back on US optimism, calling for the removal of all unilateral tariffs and denying progress in bilateral talks
Matador Resources to reduce drilling amid lower prices
- The Texas-based E&P plans to drop one of its nine rigs by mid-year, citing recent crude weakness
- CapEx for 2025 will be cut by $100 million as a result
Brent prompt spread hits widest backwardation since January (Bloomberg)
- The prompt Brent spread recently widened to $1/Bbl, a level last sustained when Brent prices were above $80/Bbl
- Global crude and condensate supply is projected to lag demand by 400 MBbl/d in April, the steepest deficit since January (OilX)
- While front-month contracts remain in backwardation, the curve flips to contango starting March 2026

Natural gas prices continue to trend lower
- The prompt NYMEX contract is lower again today, with prices below $3/MMbtu
- Overnight weather forecast changes imply a slight increase in demand expected over the next two weeks, which would usually support prices
- The EIA is expected to report a 70 Bcf injection into gas storage, according to the Bloomberg survey
- LNG feedgas demand has been lower this week, averaging 16.2 Bcf/d, as flows to Sabine Pass LNG have been weaker
Magnum Gas Storage seeks FERC approval for new Utah salt caverns (S&P)
- Magnum Gas Storage is now seeking regulatory approval to construct an additional two salt storage caverns at its Utah facility
- Two new pipeline connections will also be added, with one to Kern River’s Delta Lateral and one to the Intermountain Power Plant
- Developers say the project will support grid reliability in the Western US and help meet peak demand during periods of volatility caused by renewables or power plant retirements