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First Look - Oil rises as trade deadline looms; gas weakens as cool forecasts curb power burns

Oil rises ahead of next week’s trade deadline
- The WTI prompt-month contract rose $0.22 to $66.25/Bbl Friday morning (7:45 AM CT)
- Commerce Minister Piyush Goyal said he was confident the US and India could reach an agreement before the August 1 deadline
  - Brazil and Mexico are also looking to broaden trade ties
Goldman says diesel margins will remain high (Bloomberg)
- The bank says diesel-refining margins are likely to stay above long-run averages due to a crunch in global processing capacity
- Yulia Grigsby says the industrial fuel has been soaring with global stockpiles declining and so-called financial demand surging
  - Refinery outages in Europe and scarcity in high diesel-yield crude grades has exacerbated the situation
Chevron to continues oil operations in Venezuela (Bloomberg)
- The US government has granted Chevron permission to resume their oil operations in Venezuela after a two-month ban
- Before losing their license, the supermajor was producing 240 MBbl/d in Venezuela which it sent to refineries
- It is unclear if fresh Venezuelan barrels will arrive in time for peak US driving season which is over in about a month

August Henry Hub on track for the lowest weekly settlement of 2025
- Yesterday, the EIA reported a 23 Bcf injection into storage, which slightly shrunk the surplus to the five-year average, which is now at +171 Bcf
- Weather forecasts continue to show below average temperatures for the first week of August, which should reduce gas power demand
ArcLight to invest $5 billion on new gas-fired power plants (BBG)
- ArcLight Capital Partners is planning to build 20 GW of new natural gas power plants in the US, to supply data centers
- The plants can be brought online in 2 to 7 years, while the company is also building solar and battery facilities
- The CEO of Advanced Power. Which was acquired by ArcLight, said that “Power projects take a long time to build and that’s in a normal market. This is not a normal market”
CenterPoint sees growing power demand in Houston (BBG)
- CenterPoint Energy said they have received requests over the past few months to add 6 GW of power demand in 2026-2028
- Two-thirds of these requests are from data centers, with the rest mostly being industrial projects
- Increased power demand in the area could be supportive for HSC basis