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First Look - Oil drifts lower ahead of Alaska summit; gas on track for fourth weekly loss

Oil edges lower ahead of Trump–Putin meeting
- WTI prompt-month fell $0.40 to $63.56/Bbl Friday morning (7:45 AM CT)
- Any breakthrough toward ending the Ukraine conflict could strip a layer of geopolitical risk from crude, pressuring prices
- Arne Lohmann Rasmussen, chief analyst at A/S Global Risk Management, said, “We judge that tonight’s meeting is unlikely to deliver significant results”
Ukrainian drones strike key Russian refinery (Bloomberg)
- Lukoil’s Volgograd plant, which handles ~5% of Russia’s crude processing, was hit early Thursday
- The attack may further strain refinery runs during peak seasonal demand for gasoline and diesel
Oil sands producers lift output by trimming maintenance (Bloomberg)
- Canadian oil sands operators are boosting production by shortening repair schedules
- Efficiency gains keep average breakevens near $27/Bbl despite recent cost inflation, according to Kevin Birn, chief analyst for Canadian oil markets at S&P Global

Natural gas prices head for fourth weekly loss
- September Henry Hub prices have rebounded to $2.90/MMbtu, but are still set for a small weekly loss
- Yesterday the EIA reported a 56-Bcf injection into storage, which expanded the storage surplus to 196 Bcf above the five-year average
Weak weather-driven demand continues to weigh on gas prices
- This August could potentially be one of the coolest in several years, resulting in significantly reduced power sector gas demand, and larger storage builds
- So far in Summer 2025, gas power demand has averaged 36.96 Bcf/d compared to 39.63 Bcf/d in 2024 and 38.14 Bcf/d in 2023
- In addition to weaker demand, supply has been much higher, with Lower-48 production averaging nearly 4.5 Bcf/d more
- Storage injections have averaged 10.12 Bcf/d this summer compared to 7.61 Bcf/d last summer, and 9.12 Bcf/d in 2023
- This rapid increase in inventories has weighed heavily on gas prices, which have declined substantially in the past two months