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First Look - Oil surges as EIA cuts global oversupply forecast and inflation eases in the US

Oil prices rose 80c on Wednesday morning, reaching $67.10 per barrel (7:30 AM CT)
- Prices increased after the EIA revised its global oversupply forecast downward, citing reduced output from Iran and Venezuela
- The American Petroleum Institute (API) reported a rise in US commercial inventories, but noted a potential decline in storage at the Cushing, OK hub
  - If confirmed by the EIA, this would mark the first drop in storage at the WTI delivery point in five weeks
- The US annual inflation rate eased to 2.8% in February 2025, down from 3% in January and below the forecasted 2.9% (US Bureau of Labor Statistics)
  - Energy costs decreased by 0.2% year-over-year, following a 1.1% increase in January
- The dollar index (DXY) fell 0.5% to new 2025 lows on Tuesday, helping to boost oil prices by making crude more affordable for buyers holding other currencies
Canada’s Energy Minister threatens oil export cuts (OilPrice)
- Jonathan Wilkinson proposed this idea in response to the Trump administration’s import tariffs on Canadian goods
- He also mentioned that retaliatory measures could include critical minerals, potentially increasing US reliance on China (Reuters)

Natural gas prices have turned lower, down almost 20c this morning
- The April Henry Hub contract has continued to move lower, following yesterday, which saw prices down about 4c
- Today’s selling pressure is concentrated in the front of the curve as the Bal ’25 strip is down about 8c while Cal ’26 and beyond are trading slightly higher
- The EIA released their latest Short-Term Energy Outlook
  - The agency raised its Henry Hub price forecast by 11% to $4.20/MMbtu in 2025 and $4.50/MMbtu in 2026
GE Vernova sees order backlog through 2028 (BBG)
- Power-generation equipment manufacturer GE Vernova is seeing significant demand, leading to a major backlog in orders for gas turbines, transformers, and switchgears
- While discussions around AI and data centers have picked up over the past year, only a small portion of the orders are explicitly related to AI
- GE Vernova’s CEO said, “That’s why there's so much growth to come because we’re really just starting,”
Woodside says Louisiana LNG could start by 2029 (BBG)
- Woodside Energy said their Louisiana LNG facility could start as early as 2029, although they have not yet selected partners or made a final investment decision
- Woodside’s Louisiana LNG was acquired from Tellurian, with the project formerly being known as Driftwood LNG
- Construction had already begun under Tellurian, with the facility’s permits also being secured already