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First Look: ERCOT issues weather watch for May 8 as peak load surpasses 70 GW

Market Insights > First Look

March 21, 2022

March 21, 2022 | Rishi Rajanala

Oil surged as Russia’s war on Ukraine has dragged on for a month

Brent topped $113/Bbl as the European Union will consider a Russian oil embargo this week (Reuters)
“Russian supply uncertainty will likely be a familiar theme for the foreseeable future and will keep price volatility at the higher end of the spectrum,” said Stephen Brennock, an analyst at PVM Oil Associates

Yemen’s Houthi rebels attacked at least six sites across Saudi Arabia late Saturday and early Sunday evening (Bloomberg)

Saudi Arabia’s energy minister said a strike on a refinery in Yanbu caused “a temporary reduction” in production
The Iranian-backed Houthis have attacked Saudia Arabia on a regular basis over the past two years

India is willing to take more Russian crude at bargain prices (BBG)

Hindustan Petroleum Corp. bought 2 MMBbl of the Russian Urals for delivery in June, and other processors are also seeking cargoes, according to Bloomberg
AEGIS notes that consuming nations like India and China are expected to take advantage of cheaper Russian crude, but how much they will be willing or able to take is up for debate

U.S. gas futures are down this morning, with the prompt contract trading 7.5c lower near $4.788

U.S. lower-48 dry gas production held above 93 Bcf/d over the weekend, but its still 2 Bcf/d below the 2022 high reached in early February
U.S. LNG feedgas demand set a new record-high of 13.7 Bcf/d over the weekend, with new records at Sabine Pass and Calcasieu Pass helping push flows higher

China LNG imports from Russia doubled in February

The country imported almost 401k tons from Russia during the month of February
High prices caused total LNG imports to decline by 8.7% year-over-year in the first two months of 2022, as buyers turned to cheaper domestic coal
AEGIS notes most of the import deals would have been struck before Russia decided to invade Ukraine on February 24 and that we will see how they have responded to sanctions by the west in the coming weeks

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