The August WTI contract is trading near $68/Bbl, as the market continues to watch for signs of normalization in crude flows in the Middle East
According to Bloomberg, about 15-20 tankers have been transiting the Strait of Hormuz per day, over the past two weeks
Pre-conflict levels are about 60-80 tankers per day
RBC said in a note that they view Hormuz transits remaining below pre-war levels for some time, given continued security threats and Iran’s insistence on retaining control of the strait
Saudi Arabia cuts official selling price by most in 26 years (Bloomberg)
Saudi Aramco cut the price of its primary oil grade sold to Asia customers by $11/Bbl, bringing the official selling price to a -$1.50/Bbl discount to Brent
This is the biggest cut in at least 26 years, as the reopening of the Strait of Hormuz threatens to flood global markets with supply
The price cut indicates that they view the physical market weakening and competition among buyers decreasing, in the near-term
OPEC+ agreed to another output quota increase for August, signaling that they won’t hold back producers
Gas holds steady with a minimal weekend forecast shift
Natural gas is up 0.2c to $3.198/MMBtu (As of 07:49 AM CDT)
There was minimal change to the L48 weather forecast over the weekend
The West region warmed 11.9°F, which was mostly offset by smaller losses throughout the L48 (Criterion)
CDDs peaked in the range on Friday around 17 before tapering off to around 11 today (Criterion)
CDDs are expected to steadily rise over the next two weeks as the average temperatures move up
Upstate New York gas prices spiked (S&P)
Spot natural gas prices in upstate New York spiked July 1
Iroquois Zone 2 spot price reached $11.48/mmbtu for July 2 flows, highest since mid-February
Power demand moved up as temperatures jumped to around 9% warmer than seasonal norms
Net flows from Eastern Canada to the Northeast rose 582 MMcf/d on July 1
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