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Crude Edges Higher as Shutdown Talks Progress; Gas Prices Supported by Weather and LNG Demand

Oil climbs as Senate moves toward reopening the government
- The WTI prompt-month contract gained $0.25 to reach $60.00/Bbl Monday morning (7:45 AM CT)
- Crude prices rose as optimism grew over efforts to end the US government shutdown, lifting broader markets
- The focus shifts to upcoming agency data releases expected to shed light on potential global inventory builds
US NGL stockpiles hit record highs (Bloomberg)
- Natural gas liquids (NGLs) surged to 309 MMBbls, according to the EIA, the highest level ever recorded for this time of year
- NGLs are often grouped with crude and refined fuels in global supply-demand calculations, meaning rising inventories are reshaping the oil balance
- While these additional barrels add to total oil volumes, they exert less influence on benchmark crude prices
- A major factor behind NGL growth is U.S. shale output: “Wells are becoming more gassy,” said Don Bladridge of Phillips 66

Regional Market Insights

Updated regularly with the most important market moves and outlooks.

Natural gas is trading higher, but is down from overnight highs
- The December Henry Hub contract opened higher on Sunday night and traded as high as $4.50/MMbtu, before turning lower this morning (8:30 AM)
- Weather forecasts shifted colder over the weekend, with Lower-48 population-weighted forecasts showing temperatures close to the ten-year average for the next two weeks
  - This week will see demand spike as temperatures drop significantly in the Midwest and Northeast
- LNG feedgas reached a new record of 19.75 Bcf/d, according to data from S&P
- Lower-48 gas production remains around 106 Bcf/d, with output mostly flat over the last month
Northeast Supply Enhancement project receives permits (NGI)
- Regulators in New York and New Jersey have approved some of the necessary permits for the 400 MMcf/d Northeast Supply Enhancement (NESE) project
- The project, developed by Williams, will extend the Transcontinental pipeline by 37 miles across parts of Pennsylvania, New Jersey, and New York
- The project is expected to begin flowing gas by late 2027
- Meanwhile, Williams has withdrawn requests for water permits for the 600 MMcf/d Constitution pipeline, although they stated the project continues to advance