Oil is trading higher, reversing some losses from yesterday, after more US attacks in Yemen
The Federal Reserve kept rates unchanged yesterday, and Chairman Powell said that interest rate cuts in March are “probably not the most likely case”
OPEC+ members are set to decide on extending production cuts into 2Q 2024 in early March to avert a surplus and keep prices higher (Bloomberg)
Furthermore, Algeria said it's ready to continue OPEC+ cuts past March
Chinese refining margins remain low, signaling weak crude demand (BBG)
Private oil refiners in China may be forced to curtail production due to weak margins driven by high oil prices and lower product prices
Sanctioned Russian crude has become costlier, which has hit independent refiners who have been relying on it
Economic data from China has continued to show slower growth, spurring additional calls for more government stimulus measures
In contrast, Chinese factory activity expanded for the third consecutive month in January
Russian oil enters the US through a Bahamas loophole (BBG)
A refiner imported 10 MBbls of Russian crude, bypassing the US sanctions through a blending loophole at a Bahamas storage terminal
The crude was brought into PBF Energy’s Delaware refinery in November but did not violate sanctions because it was imported to the Bahamas before the start of sanctions and mixed with other grades of oil
Natural gas prices trade modestly higher on forecasts for the return of mildly cold weather in the back half of February
March ’24 Henry Hub is up 0.9c this morning to trade around $2.109/MMBtu
The Summer ’24 strip is down 2.4c to $2.445, and the Winter ‘24/’25 strip is down 2.2c to $3.456
Today's Euro Ens shows a colder shift with a 6o F drop in average Lower 48 temps, mainly affecting the Northeast/Southeast, leading to a less-warm pattern that's closer to the 10-year average
Lower 48 production nominations fell by 0.54 Bcf/d, led by declines in the South Central and Rockies regions, with a slight increase in the Northeast and Gulf of Mexico, bringing production down to 102.31 Bcf/d (Criterion)
U.S. LNG exports near record levels despite cold weather (S&P)
U.S. LNG exports in January neared the record highs of December, despite freeze-offs
As of yesterday, LNG exports increased to 8.56 million mt, a rise of 520,000 mt since the beginning of the week
This export level was nearly 97% of the export volumes seen in December, which was the highest monthly U.S. LNG export level on record
Furthermore, Atlantic-based traders said the month-long outage at Freeport LNG's Train 3 is expected to have minimal impact due to high inventories and weak demand in Europe and Asia
U.S. House to vote on overturning Biden's LNG export pause (PGJ)
The U.S. House of Representatives plans to overturn the Biden administration's moratorium on new LNG export approvals, reported Bloomberg, citing a Republican lawmaker
The measure will be voted on in mid-February, said Representative Cathy McMorris Rodgers, the chair of the House Energy and Commerce Committee
The moratorium, expected to receive broad support in the Republican-controlled House, is less likely to pass in the Democratic-majority Senate
The pause, expected to last until after the Nov. 5 election, could affect facilities slated to enter service beyond 2027
Get market insights delivered to your Inbox every day!
