- WTI is up 47c to $37.73/Bbl, and Brent is up 42c to $40.03/Bbl
- Oil rose Tuesday morning despite the IEA forecasting a bleaker outlook for demand
- The International Energy Agency (IEA) followed other bearish demand calls this week from BP Plc, Trafigura Group and OPEC
- Constructive Chinese data helped offset the IEA news as retail sales rose for the first time this year in August while industrial production gained by a larger-than-expected 5.6%
- The IEA, which advises major economies, cut its forecasts for fuel consumption for the rest of the year and predicted that oil inventories won’t subside as sharply as anticipated (Bloomberg)
- “We expect the recovery in oil demand to decelerate markedly in the second half of 2020, with most of the easy gains already achieved,” the agency said in its monthly report
- The largest adjustment to the demand forecast was for the fourth quarter, cut by 600 MBbl/d
- Some of the downward revision stems from the growth in teleworking, which “in the space of just a few months” is having a “meaningful impact” on demand by depressing the need for transport fuels, the IEA said
- Natural gas is up 1.0c to $2.320/MMBtu
- The Bureau of Safety and Environmental Enforcement (BSEE) provided an update on GoM production outages as Hurricane Sally nears landfall
- The BSEE estimated 25.28% of gas production (532.55 MMcf/d) is shut-in
- Personnel have been evacuated from 147 production platforms out of 643 in the Gulf, according to the BSEE
- Mountain Valley Pipeline in-service extension faces heavy opposition from environmental groups
- On August 25, Mountain Valley Pipeline LLC applied to FERC for a two-year in-service extension for its controversial project, the Mountain Valley Pipeline
- The in-service certificate is set to expire in October, however Equitrans has asked that the deadline be extended until October 2022
- EQT curtailments contribute to declining production in the Appalachian basin (Platts)
- EQT began curtailing 425 MMcf/d of gas production on September 1. These curtailments come only two months after EQT’s 1.4 Bcf/d curtailments were brought back online in mid-July
- On EQT’s 2Q2020 earnings call, CEO Toby Rice announced “future production curtailments would remain a possibility over at least the next several years – particularly during spring and autumn shoulder seasons – as the company remains in maintenance-production mode”
- Appalachian gas production has averaged 32.5 Bcf/d in September thus far, nearly 300 MMcf/d lower than the 32.8 Bcf/d average in August
