- WTI is up 51c to $61.65/Bbl, and Brent is up 42c to $64.77/Bbl
- Texas freeze knocks out 4 MMBbl/d (40%) of the nation’s crude production
- Initially, production was only expected to be offline for a few days. As the situation has worsened, analysts now are saying that it could take a few weeks for a full resumption
- Nearly 16 MMBbls will be lost through early March, according to Citigroup. Other estimates say the total could be as high as 32 MMBbls
- Iraq’s crude oil exports jumped during the first half of February, despite the pledge to cut output further
- Industry officials are still claiming they will adhere to the self-imposed quota of 3.6 MMBbl/d, though the current pace of exports suggests otherwise
- AEGIS notes Iraq is one of the cartel’s member countries that frequently falls short of complying with the group’s quotas. While this may not immediately impact price, it gives OPEC, and in particular Saudi Arabia, more reason to increase production during the groups next meeting
- EIA weekly data is due at 9:30 am CST
- U.S. Crude Inventories: – 2,425 MBbls (Avg. Bloomberg surveys)
- U.S. Gasoline Inventories: + 1,323 MBbls
- U.S. Distillate Inventories: – 1,768 MBbls
- U.S. Refinery Utilization: – 0.29% change
- Natural gas is down 3.8c to $3.181/MMBtu
- Texas Governor Greg Abbott ordered gas companies to restrict out-of-state sales amid shortages (Bloomberg)
- The order, which is being reviewed by state regulators, interferes with Constitution’s commerce clause, where states are prohibited from interfering in interstate trade
- Abbott used a disaster declaration he issued on Feb. 12 to clamp down on cross-state border sales
- Republican lawyer Jared Woodfill said Abbotts banning of out-of-state sales was “an abuse of the Texas Disaster Act”
- The historic amount of freeze-offs in Texas and the Midcontinent continued on Wednesday, sending Henry Hub prices higher with reduced gas production in the Permian, Haynesville, and the Eagle Ford
- U.S. natural gas production hit an estimated 72.1 Bcf/d – a 20%, or nearly 18 Bcf/d drop in output over the past week, according to Platts data
- Single-digit temperatures in Midland, Texas, helped send West Texas gas production to 6.9 Bcf/d, down about 42% over the past week
- Haynesville production has fallen by over 4 Bcf/d to around 8.2 Bcf/d since the weekend according to Platts
