Oil trades lower Friday, but remains on track for a weekly gain
The WTI prompt-month contract fell $0.41 to $57.94/Bbl on Friday morning (8:23 AM CT)
Despite today’s pullback, crude remains headed for its strongest weekly advance since late October
Weekly gains have been driven by rising geopolitical risk, including intensified US efforts to restrict Venezuelan crude exports
US forces are prioritizing enforcement of a de facto blockade on Venezuelan oil shipments over the next two months, increasing near-term supply and freight uncertainty
A sanctioned tanker recently turned away from Venezuela after being pursued by US forces, reinforcing disruption risk around exports
Geopolitical tensions also escalated after the US launched strikes against Islamic State targets in northwest Nigeria, an OPEC producer pumping roughly 1.5 MMBbl/d
Even with this week’s rally, the broader market remains weighed down by expectations for a global surplus in 2026
Geopolitical premiums are providing short-term support, but have not materially altered the longer-term bearish supply-demand outlook
Natural gas heads for weekly gain
The prompt month Henry Hub contract is on track for the first weekly gain in two weeks, with prices trading near $4.35/MMbtu
Lower-48 temperatures are currently forecast to be slightly cooler than the ten-year average for the next two weeks, following this week which was significantly warmer than average
Dry gas production remains near a record high, with output above 109 Bcf/d for nine consecutive days, according to S&P data
The next EIA natural gas storage report will be released on Monday December 29 for the period ending December 19, shortly followed by another release on Wednesday December 31
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