Crude Falls as US Peace Push Eases Risk Premium; Natural Gas Slips as Injection Season Arrives

Crude slides as US advances peace framework

• The WTI prompt-month contract fell $3.43 to $88.92/bbl on Wednesday morning (7:30 AM CT)
• Oil prices moved sharply lower as Washington intensified efforts to broker an end to the conflict with Iran
• • US officials outlined a 15-point framework that would scale back Iran’s nuclear activities and impose new limits on its missile capabilities, according to Bloomberg
• Iran rejected the proposed ceasefire and continued strikes on Israel and Gulf Arab states, undermining US diplomatic efforts
• • Iran’s semi-official Fars news agency indicated that a ceasefire is not acceptable under current conditions
• Ships attempting to pass through the Strait of Hormuz with Iranian oversight are being required to submit ship and voyage information to receive clearance from the Islamic Revolutionary Guard Corps

Natural Gas slips as implied storage balances flip to injection

• Natural gas is down -2.0c to $2.923/MMBtu. (As of 07:30 AM CT)
• Demand fell sharply day-over-day as L48 rescom shrank -5.7 °F this morning to 20.5 Bcf/d (Criterion)
• The 2-week cumulative demand outlook trimmed around -6 Bcf/d of demand this morning as temperatures warmed primarily in the 6–10-day range
• L48 storage week temperatures are now forecasted to be above 58 °F across the entire forecast range, noticeably higher than earlier forecasts for this range
• As weather-driven demand forecasts step down over the next couple of weeks, the market transitions into the injection season

FERC grants approval on construction start for MVP Southgate gas pipeline (S&P)

• Mountain Valley asked FERC to issue a notice to proceed by March 23, on March 20
• • They asked for a quick turnaround on their request, citing seasonal restrictions on tree clearing
• The 31.1 Mile, 550 MMcf/d pipe is expected to add production-enabling takeaway capacity out of the Northeast to the Southeast markets