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Crude Rises as Leaders Urge Sanctions; Natural Gas Slips Toward August Lows

Oil Climbs as Western Leaders Push for Tighter Sanctions on Russia
- The WTI prompt-month contract rose $0.88 to $63.16/Bbl Tuesday morning (7:45 AM CT)
- Canadian Prime Minister Mark Carney urged western allies to implement secondary sanctions on Russia swiftly to increase pressure on President Vladimir Putin
- This followed remarks from President Trump, who called on European nations to halt Russian energy purchases, though the US has so far spared China, the largest buyer of Russian crude, from additional tariffs
- Russia’s seaborne crude exports have reached a 16-month high, with four-week average shipments climbing to 3.62 MMBbl/d, according to Bloomberg
- Meanwhile, Russian refining runs have dropped below 5 MMBbl/d after Ukrainian drone strikes disrupted at least 7% of the country’s fuel-making capacity
- The refinery disruptions appear to be redirecting crude flows to export terminals, adding more barrels to seaborne supply, while Russian output continues to rise under the OPEC+ framework
Exxon Greenlights New Guyana Oil Development (Bloomberg)
- Exxon plans to advance its seventh offshore oil project in Guyana after securing regulatory approvals
- The $6.8 billion Hammerhead development is expected to start production in 2029, with a capacity of 150 MBbl/d
- The project will rely on a floating production, storage, and offloading vessel and include 18 production and injection wells

Regional Market Insights

Updated regularly with the most important market moves and outlooks.

Natural gas is lower, with October approaching a year-to-date low
- Prompt prices have come off in recent days, with October Henry Hub nearing the lowest price seen so far this year of $2.74/MMbtu, set in August
- Lower-48 demand should be limited over the next several weeks, as temperatures decline
- Gas production is sharply lower today amid pipeline maintenance in the Northeast, according to data from S&P
Golden Pass LNG receives approval to re-export LNG (Bloomberg)
- The DOE has approved Golden Pass to export 50 Bcf, previously imported to cool down plant equipment
- This is one of the steps required before the facility can start up, which is expected around December
- Golden Pass has been receiving small volumes of pipeline gas in recent weeks, averaging about 2 MMcf/d, likely for testing onsite equipment