Oil steadies as market looks ahead to US–Iran talks
The WTI prompt-month contract edged up $0.07 to $63.28/Bbl as of Wednesday morning (7:30 AM CT)
Indirect negotiations between Iranian Foreign Minister Abbas Araghchi and US envoy Steve Witkoff are set to take place in Oman on Friday
Iran’s semi-official Tasnim news agency said discussions would be “limited to the nuclear issue and the lifting of sanctions”
The planned talks follow a US move earlier this week to shoot down an Iranian drone
While major agencies and banks continue to flag an oversupplied outlook, prices are finding support from geopolitical risk tied to a potential conflict in the Middle East, a region that produces roughly a third of global crude
Separately, the American Petroleum Institute reported US crude inventories fell by 11.1 MMBbls last week
If confirmed by EIA data later Wednesday, the draw would mark the largest weekly decline since June
Morgan Stanley lifts near-term oil outlook
The bank raised its short-term price forecast while maintaining its view that global supply will outpace demand over the course of the year
Morgan Stanley now sees Brent averaging $62.50/Bbl in 1Q, up from a prior $57.50/Bbl forecast, citing expectations that “the geopolitical risk premium is likely to persist for a period”
Prompt-month natural gas is up 6.3c to $3.374/MMbtu (07:30 AM CDT)
Weather forecast shifts were mixed, resulting in Lower 48 temperature changes being a near-flat 0.8°F gain over the 1-15 day forecast period
While the Northeast and Southeast regions got 9.4°F and 7.7°F colder respectively in the 11-15 day forecast period, they were offset by forecasted temperature gains in the West, Rockies, and South Central
HDDs are still above normal, but are expected to fall below the 10 YR Average in the middle of next week
Production gains from the prior day of 200 MMcf/d to 109.7 Bcf/d were primarily centered in small gains in the South Central region
FERC unanimously approved the order, citing the clear need for the project
With FERC approval being granted on January 29th, it’s expected to remain on schedule to start within the seasonal construction window before April 1st
The project is expected to provide partial service in time for the 2026-27 winter heating season
Golden Pass LNG is expected to begin production in early March (S&P)
S&P Global analysts expect Golden Pass to export its first LNG cargo in April, based on low feedgas deliveries to the terminal in January
Golden Pass is expected to reach full commercial service in 2027, which would then give it a feedgas demand of around 2.5 Bcf/d
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