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Crude Rises as Shipments Surge; Natural Gas Slips Ahead of EIA Print

Oil rises on export surge despite higher stockpiles
- The WTI prompt-month contract gained $0.26 to $64.32/Bbl Thursday morning (7:45 AM CT)
- The EIA reported a 9.2 MMBbl draw in U.S. crude inventories last week, though combined crude and product stocks climbed to the highest level in a year
- Crude exports surged above 5 MMBbl/d, the strongest since December 2023, offsetting weaker refinery runs and driving the draw
- Distillate inventories rose by more than 4 MMBbls, lifting supplies to the highest since late January
- The Federal Reserve cut rates by 25 basis points and signaled another 50 basis points of easing projected in 2025
IEA projects steep decline in MENA oil burn for power
- Oil use in electricity generation across the Middle East and North Africa is expected to shrink sharply, freeing up more Saudi and Iraqi barrels for export, according to the IEA
- Oil’s share of the region’s power mix is forecast to fall to 5% by 2035, down from about 20% today, as natural gas and renewables displace crude
- IEA Executive Director Fatih Birol said oil no longer consumed in power plants “will definitely be a contribution to the supply” in global markets

Regional Market Insights

Updated regularly with the most important market moves and outlooks.

Natural gas is trading lower ahead of EIA inventory report
- The EIA is expected to report an injection of 81 Bcf today, with estimates ranging from 70-86 Bcf, according to the Bloomberg survey
- The outlook for demand over the next two weeks shifted lower, as Lower-48 weather forecasts cooled toward the ten-year average
Record Permian production and maintenance impacting Waha prices (NGI)
- Spot prices and the prompt month Waha futures fell below $0/MMbtu on September 12, and remain negative through yesterday’s settlement amid a combination of high production and pipeline maintenance
- Waha spot prices traded below zero for much of 2024, but increased pipeline capacity this year has helped somewhat
- Gas production in the Permian Basin reached a new record of more than 22 Bcf/d recently
- Waha prices will remain at risk of weakness during periods of maintenance, especially with no new pipelines starting up until 2H 2026