June 26, 2019

June 26, 2019July 1st, 2019
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  • WTI is up $1.12 to $58.95/Bbl, and Brent is up 81c to $65.86/Bbl
  • Oil surged higher after hours on Tuesday following the API reporting a large crude inventory withdrawal
    • WTI jumped about $1/Bbl just after 3:30 PM CT on the data release
    • The more closely followed EIA data will be released this morning at 9:30 AM CT.
    • US based oil prices are highly sensitive right now to changes in crude inventories
      • Crude stocks have swelled over the past few months on higher production and lower y-o-y refinery runs
  • EIA petroleum data is due out this morning at 9:30 am CT
    • U.S. Crude Inventories:                  –    2,837 MBbls (Bloomberg surveys)
    • U.S. Gasoline Inventories:             –       330 MBbls
    • U.S. Distillate Inventories:            +      170 MBbls
    • U.S. Refinery Utilization:               +   0.34% change
  • Energy Transfer is mulling a further expansion of the Dakota Access pipeline (DAPL) that currently moves up to 570 MBbl/d
    • The plan does not include any new pipe or mainline construction, but would include added horsepower and “a few modifications and upgrades”
    • The expansion should be completed by late 2020 and company comments did not include the amount of capacity increase
  • Natural gas is down 1.0c to $2.298/MMBtu
  • Weather is forecasted to be seasonally above-average, on the east coast, heading into the beginning of July
    • Western markets could see a spike in warmer temperatures during the back half of June
  • Kinder Morgan can now begin construction of the Permian Highway Pipeline after being dismissed from landowner disputes by a Texas court
    • This is a victory for Kinder’s project, but it could face other challenges in the future as the pipeline route runs through the Texas hill country where it still faces opposition
    • The Permian Highway is a 2.1 Bcf/d project that runs from the Waha Hub into eastern Texas markets
    • The project has an anticipated start date in 2H2020
  • US LNG feedgas is setting new record highs, almost 6.2 Bcf/d as of yesterday, as we near completion of the “first wave” of LNG projects

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