July 15, 2019

July 15, 2019
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  • WTI is up 22c to $60.43/Bbl, and Brent is up 28c to $67.00/Bbl
  • Almost 75% of crude oil production in the Gulf of Mexico was offline as of Sunday due now Tropical Depression Barry
    • Works are preparing to return to their offshore platforms as Barry weakens
    • The removal of over 1 MMBbl/d starting late last week has helped buoy crude oil
  • Iranian President Hassan Rouhani said Iran is ready to hold talks with the US if Washington lifts sanctions and returns to the 2015 nuclear deal (Reuters)
    • Rouhani said “if they lift sanctions, end the imposed economic pressure and return too the deal, we are ready to hold talks with America today, right now and anywhere”
    • AEGIS notes that US sanctions on Iran have reduced their crude exports to less than 400 MBbl/d from more than 2.5 MMBbl/d in April 2018
  • China’s GDP in the 1H ’19 expanded at the lowest pace in at least 27 years, according to data from China’s National Bureau of Statistics (S&P)
    • GDP grew at 6.3% year on year during 1H ’19
    • Beijing plans on rolling out stimulus during the rest of the year, which would offer support to the world’s second biggest economy
    • AEGIS notes how important China’s economic health is to crude oil demand. Clients can check out or latest Market Summary where we discuss global economic health
  • Natural gas is down 4.1c to $2.412/MMBtu
  • Despite Tropical Storm Barry disrupting production in the Gulf, as well as Cameron and Cheniere temporarily halting inbound tankers, LNG feedgas reached a new record of 6.4 Bcf/d
  • Final shut-in numbers for Barry were 1.8 Bcf/d, or 62% of gas production, and 1.4 MMBbls/d, or 73% of oil production in the Gulf Coast
    • 283 production platforms and 10 rigs were evacuated during this time
  • SCOOP/STACK rig activity has plummeted this year from 106 active rigs to 80 (Platts)
    • Slowdown primarily stemming from the STACK which dropped from 64 active rigs to 33
    • Gas production is forecast to only increase by a fractional amount, 300 MMcf/d, through 2020
    • SCOOP/STACK slowdown comes on the heels of signs pointing to Permian production weakness, as many operators begin to lower future guidance
      • Midship pipeline (SCOOP/STACK), Gulf Coast Express (Permian), and Permian Highway (Permian) could help to bolster production in the future

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