Crude rises as US-Iran Agreement Expires; Gas Inches Up as Production Pulls Back

Crude rises as US-Iran agreement expires without extension

• The WTI prompt-month contract rose $0.57 to $85.07/Bbl Tuesday morning (7:45 AM CT)
• President Trump said he has little interest in extending the agreement with Iran, leaving the conflict in a prolonged standoff with neither side moving toward renewed military escalation or a diplomatic resolution
• • The administration is instead leaning on a renewed maximum-pressure campaign, including the naval blockade and additional economic pressure, in an effort to push Tehran toward more acceptable terms for reopening the Strait of Hormuz
• The UKMTO reported another vessel attack in the Omani corridor overnight, while observable tanker traffic through Hormuz remains limited
• “Everyone is walking around in fog these days,” said Bjarne Schieldrop of SEB, adding that “just sitting long waiting for the upside is a tough approach in today’s market”

Gas inches up as production pulls back

• Natural gas is up 2.3c to $2.713/MMBtu (As of 07:45 AM CDT)
• L48 dry gas production fell 1.2 Bcf/d to 111.8 Bcf/d (Criterion)
• Weather forecasts shifted slightly warmer, with the L48 gaining around 4°F total day over day
• • The Midwest led the gain, up 10.7°F across the forecast period
• Power demand is sitting at 51 Bcf/d today
• • It averaged 48 Bcf/d last week, and is expected to tick up to 48.5 Bcf/d this week (Criterion)

Natural gas-fired generation averaged 267.1 GW last week, the fourth highest on record (NGI)

• Natural gas supplied about 44% of the total 603.33 total generation, down from 47% when the record was set two summers ago (EIA)
• Wind and solar picked up approximately 34 GW more than the record in 2024

ERCOT outlines large load verification process in response to Abbott

• After Abbott halted work on current PUCT and ERCOT batch zero interconnection with his directive, ERCOT responded with a redesigned verification process on Aug 18
• The gird operator assumes that about 200 GW of large load are still eligible for batch zero, out of the 474 GW of large load applications