February 18, 2020

February 18, 2020
Print Friendly, PDF & Email
  • WTI is down $1.05 to $51.00/Bbl, and Brent is down $1.23 to $56.44/Bbl
  • Continued fears over the impact on the global economy and fuel demand from China’s COVID-19 helped push oil prices lower this morning (Bloomberg)
    • Chinese refineries continue to trim processing rates and at least two trading houses have rented crude-oil storage tanks in South Korea as supply stacks up, according to Bloomberg
    • China’s oil stockpiles at ports rose to 60% of capacity, according to industry consultant Oilchem China
    • Markets have become overconfident in expecting a V-shaped rebound from the epidemic, according to Citigroup
  • Speculators increased their net-short position in WTI calendar spread options to the largest in five years last week (CFTC)
    • The net-long position stands at 124k contracts – the lowest since early November
  • The U.S. rig count was flat at 790 for the third week in a row (Baker Hughes)
    • Oil-directed rigs rose by two to 670
    • Oil rigs are down 179 from 857 a year ago
  • Natural gas is up 11.8c to $1.955/MMBtu
  • Natural gas prices jumped into the $1.90/MMBtu range on the emergence of colder-than-normal weather throughout the two-week forecast, as well as low holiday trading volume
    • The colder weather equates to an additional 30 Heating Degree Days
    • Should this cold pattern continue, the prompt-month contract could be aided by some additional short covering from speculators who hold a massive bearish position
  • The CFTC reported managed money short positions fell 10,206 contracts to total 494,913
    • Managed money long positions fell 25,315 contracts to total 163,365
  • TC Energy believes they can phase in their Villa-de-Reyes pipeline into service by the end of the year
    • The Tuxpan-Tula pipeline is still facing on-going disputes, but will be completed two years after consultations with the Mexican government are successfully completed
    • Once these two pipelines are complete, AEGIS expects stronger flows on the Sur-de-Texas pipeline

Access Our Deeper Market Insights

Product Factor Matrix

Proprietary view of priced-in factors driving the market vs. potential bullish and bearish surprises.

Learn More

Trading Recommendations

Clear trading recommendations based on real market opportunities that enable clients to take action.

Learn More

Market Data

A comprehensive suite of the latest curves, spot pricing, settles, and strips to drive confident hedging decisions.

Learn More

Benchmarking and Trade Analytics

Real-time access to analyze your hedging strategy against AEGIS benchmarks and current market activity.

Learn More