April 8, 2021

April 8, 2021
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  • India is preparing to purchase Iranian crude in anticipation of easing U.S. sanctions
    • India, the world’s second-largest crude importer, has expressed frustration with the elevated cost of supplies from Saudi Arabia
    • The country is currently dealing with a covid-19 resurgence, recording the highest number of new cases since the pandemic began on Wednesday, April 7, 2021
  • FGE boost its 2021, 2022 global demand outlook amid Asian demand growth
    • FGE estimates global demand will grow 6 MMBbl/d this year, a 75 MBbl/d increase from its last forecast
    • 2022 global oil demand is expected to grow by 4.1 MMBbl/d, a 325 MBbl/d increase from its previous estimate
    • The company noted that a resurgence in COVID-19 cases in Europe and Latin America pose a downside risk to global demand forecasts
  • The market received mixed signals from inventories data reported by the EIA on Wednesday
    • The EIA reported a draw of (-) 3,522 MBbls for the week ending April 2, well above the estimate of a (-) 1,638 MBbls draw
    • Gasoline and distillates inventories increased by (+) 4 MMBbls and (+) 1.5 MMBbls, respectively
  • Natural gas futures for May have continued to trade near $2.52 since mid-March
    • Weather so far this spring has been more moderate on average, resulting in lower than usual demand
    • LNG exports have remained one of the major bright spots lately. US LNG facilities have been consuming nearly 12 Bcf/d over the past 30 days as of April 7
  • Higher year-over-year Henry Hub prices have resulted in lower US gas-fired power burns (Platts)
    • Henry Hub cash prices have traded at an average of $2.65/MMBtu so far this year – after excluding February freeze outliers
    • Compared to 2020, Hub prices are up about 80c this year, or more than 43%, S&P data showed
    • This year’s higher gas prices are leading to about 10% more coal generation than the same period last year in MISO (Midcontinent Independent System Operator). Similar losses, but slightly less, have been observed in other electricity regions

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