Crude Pushes Higher as Hormuz Attacks Overshadow IEA Reserve Release Plan

Oil rises despite IEA reserve release plan

• The WTI prompt-month contract climbed $4.17 to $87.62/Bbl on Wednesday morning (7:51 AM CT)
• The International Energy Agency is considering what would be the largest emergency stock release in its history, with member countries potentially making up to 400 MMbbl of crude available from strategic reserves
• IEA member nations collectively hold more than 1.2 Bbbl of government-controlled emergency inventories, along with roughly 600 MMbbl of industry stocks maintained under mandatory stockholding rules that could also be mobilized if market conditions warrant
• • According to the IEA, global observed oil inventories climbed above 8.2 Bbbl in 2025, the highest level since 2021, potentially offering a buffer against supply disruptions
• At the same time, the UK Navy reported that three commercial vessels were struck by suspected projectiles in the Strait of Hormuz on Wednesday
• • The incidents reportedly involved a cargo vessel off the coast of Oman, a container ship west of Ras Al-Khaimah, and a bulk carrier northwest of Dubai
• As storage infrastructure across the region approaches capacity, producers in Iraq, Kuwait, Qatar, Saudi Arabia, and the UAE have announced combined production reductions estimated at roughly 6.7 MMbbl/d

Natural gas prompt month is up $0.10 to 3.12 (7:46 AM CT)

• Weather forecasts cooled today, adding back 18.1 Bcf of demand to the forecast period (Criterion)
• • Drops were most notable in the Northeast and Midwest, which reversed gains from yesterday in the 11-15 day range
  • Temperatures are roughly falling within 5 degrees of the 10 year average over the forecast period starting tomorrow

Kinder Morgan seeks 1.3 Bcf/d extension to Kinder Morgan Louisiana Pipeline system (S&P)

• KMLP requested authorization for the Texas Access Project, which will add 1.3 Bcf/d of transport capacity from Texas to Louisiana
• They aim for FERC approval by Feb 2027, with the goal of bringing the project partially online in Jan 2028
• This project will not increase capacity on the system overall, but rather transport capacity from growing Texas sources to the Louisiana LNG Corridor, according to company executives