April 15, 2020

April 15, 2020
Share
Print Friendly, PDF & Email
  • WTI is down 38c to $19.73/Bbl, and Brent is down $1.10 to $28.50/Bbl
  • Oil fell under $20/Bbl as the International Energy Agency (IEA) said demand would slump by a record this year despite supply cuts (Blomberg)
    • Demand for oil will decline over 9 MMBbl/d this year, wiping out a decade of consumption growth, the IEA said
    • “We may see further downward pressure on prices in coming days and weeks,” IEA Executive Director Fatih Birol said
  • IEA World Oil Supply/Demand Key Forecasts:
    • Non-OPEC supply for 2020 was revised to 63.2 MMBbl/d from 67.1 MMBbl/d
    • Call on OPEC crude 2020 was revised to 22.1 MMBbl/d from 27.3 MMBbl/d
      • OPEC crude production in April rose by 2.62 MMBbl/d on the month to 31.2 MMBbl/d
    • Demand change is 2020 estimate -9.3% y/y or 9.4 MMBbl/d
  • Energy regulators in Texas debated Tuesday whether the state should impose 20% crude oil supply cuts on produciton to help support price
    • A 20% reduction from Texas would be about 1 MMBbl/d, as the state currently producing about 5 MMBbl/d
    • Parsley Energy and Pioneer Natural Resources led the argument in favor of requiring cutbacks during the 10 hour long TRC hearing
    • Opponents argued the free markets are working and Texas producers are rapidly cutting back
  • EIA weekly data is due at 9:30 AM CST
    • U.S. Crude Inventories:                  +     12,024 MBbls (Avg. Bloomberg surveys)
    • U.S. Gasoline Inventories:             +        7298 MBbls
    • U.S. Distillate Inventories:             +       2,034 MBbls
    • U.S. Refinery Utilization:               –     1.85% change
  • Natural gas is down 1.4c to $1.636/MMBtu
  • Korea Gas Corporation (Kogas) is in talks with term LNG suppliers to delay cargoes for delivery through October, according to Bloomberg
    • Kogas has asked Qatar, one of their primary suppliers, to delay as many as 18 cargoes over the next six months
    • AEGIS notes that forgoing cargo delivery through October could signal that global gas demand is not anticipated to return until late 4Q2020
    • It could also suggest that the global LNG market may be oversupplied until the end of 2020, keeping international prices low and further pressuring U.S. export margins
  • On Tuesday, gas deliveries to Freeport LNG dropped by 580 MMcf/d
    • Freeport LNG officials have declined to comment on how long the planned maintenance will last or which trains are affected
    • This planned outage comes at the same time as US’s first LNG shipment (loaded at Freeport LNG) to China in over a year nears arrival
    • Total feed gas demand continues to average above 8.0 Bcf

Access Our Deeper Market Insights

Product Factor Matrix

Proprietary view of priced-in factors driving the market vs. potential bullish and bearish surprises.

Learn More

Trading Recommendations

Clear trading recommendations based on real market opportunities that enable clients to take action.

Learn More

Market Data

A comprehensive suite of the latest curves, spot pricing, settles, and strips to drive confident hedging decisions.

Learn More

Benchmarking and Trade Analytics

Real-time access to analyze your hedging strategy against AEGIS benchmarks and current market activity.

Learn More