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First Look - Oil steady as IEA reports bearish outlook; gas rebounds from one-year low

Oil steady after IEA forecasts gloomy outlook
- The WTI prompt-month contract fell $0.01 to $63.16/Bbl Wednesday morning (7:48 AM CT)
- According to the IEA, oil inventories are set to grow at the fastest pace on record next year and hit a 46-month high in June
- The Energy Information Administration’s Short-Term Energy Outlook projects US crude output to shrink to 13.28 MMBbl/d in 2026
  - The agency’s previous projection in July was for 13.37 MMBbl/d, and the country is on track for the first annual drop in crude production since 2021
- Keshav Lohiya, founder of consultancy Oilytics, said the market remains in “wait-and-see mode” ahead of the upcoming Trump–Putin meeting in Alaska
Ukraine strikes key Russian oil pipeline hub (Bloomberg)
- Ukraine said it targeted the Unecha oil-pumping station, a critical link in the Druzhba network, sparking a large fire and damaging facilities
- The site moves Russian crude to Hungary and Slovakia and handles Kazakh oil transiting to Germany

Natural gas recovers after sliding to new one-year low
- The September Henry Hub contract fell to $2.77/MMbtu yesterday, as gas prices continue to trend lower
- Weather-driven gas demand over the next two weeks is expected to be relatively limited, as Lower-48 temperatures remain near or below the 10-year average
Louisiana southbound pipeline volumes increase (S&P)
- Higher LNG feedgas demand and the startup of the Louisiana Energy Gateway pipeline has resulted in increased volumes of gas flowing from northern Louisiana to southern Louisiana
- North to south volumes have averaged 14.4 Bcf/d so far this month, about 2 Bcf/d higher than the same period last year
- The startup of the new 1.8 Bcf/d LEG pipeline has increased pipeline capacity out of the Haynesville, with observable flows totaling about 700 MMcf/d
- Flows should continue to rise over the next several months, as LNG feedgas demand continues to rise and the 1.7 Bcf/d NG3 pipeline begins service in 4Q 2025