Weekly Market Summary, November 13, 2026

Crude Pulls Back as War Risk Eases and Fundamentals Loosen

Crude prices remained under pressure this week as expectations for another near-term US military campaign against Iran faded and the physical market continued to loosen. President Trump said further large-scale strikes appeared unnecessary and later signaled that Washington was comfortable maintaining the current blockade rather than immediately pursuing either a diplomatic agreement or broader military action. At the same time, Iran maintains a hardline position in the nuclear negotiations.

The recovery in Middle Eastern supply has become increasingly important to the fundamental outlook. OPEC+ production increased by roughly 2.0 MMBbl/d in October to 41.23 MMBbl/d, equivalent to approximately 97% of February prewar output. Saudi Arabia accounted for much of the increase, while Saudi oil loadings reached 7.5 MMBbl/d in October, the highest level since the war began, as exports through Yanbu recovered following September’s disruption to the East-West pipeline.

The latest EIA outlook also points to a looser balance ahead. The agency expects global inventories to build by roughly 1.46 MMBbl/d in 4Q26 before the surplus accelerates to approximately 3.5 MMBbl/d during the first half of 2027. US commercial crude inventories also increased by 4.7 MMBbl last week to 414.4 MMBbl, against expectations for a decline, adding to signs that the physical crude market is becoming less tight.

However, the regional security situation remains far from normalized. S&P Global Commodities at Sea estimates crude shipments through Hormuz have averaged just 2.8 MMBbl/d in November, down from 3.4 MMBbl/d during the second half of October as Iranian attacks intensified. The Houthis also claimed attacks this week on the East-West pipeline, Yanbu and an Aramco building in Riyadh, although no significant operational disruptions have been confirmed.

AEGIS maintains a bullish view on Bal 26 WTI. Recovering Middle Eastern production and an increasingly loose near-term balance have made the fundamental backdrop less supportive, but the risk of renewed military escalation remains significant. The US and Iran remain far apart, Hormuz traffic remains constrained and attacks continue against vessels and regional energy infrastructure. We continue to see near-term risks tilted to the upside if regional flows deteriorate again, while sustained normalization remains the primary downside risk.

We remain neutral on Cal 27. The 2027 supply-and-demand balance remains considerably more bearish as Middle Eastern production recovers and global inventories rebuild. The EIA’s projected 3.5 MMBbl/d inventory build during the first half of the year reinforces that view, although the size of the surplus remains dependent on a sustained recovery in regional production and trade flows.

Natural Gas Jumps on Colder Weather Forecasts

The December Henry Hub contract settled at $3.23/MMBtu this week, gaining 25c. Most of the gains were concentrated in the peak winter months, with Summer ’27 up only 3c to $2.73/MMBtu. Winter ‘27/’28 gained 2c to settle at $3.73/MMBtu. This move came as weather forecasts for November turned cooler, leading to increased demand expectations.

Last Friday, November was forecast to be the warmest on record, with heating demand substantially reduced compared to ten-year average levels. This had been weighing on prices and likely contributed to near-record short positions by speculators in Henry Hub futures. Over last weekend, weather forecasts turned marginally cooler, although not enough to lift November’s outlook out of record warmth. Over the course of this week, forecasts continued to shift cooler, lifting November’s forecast to be only the fourth warmest on record. While still bearish compared to the ten-year average, this change was enough to send gas prices sharply higher in the front of the curve. This may result in the first net storage withdrawal of this winter to occur during the week of November 20, marking the start of the withdrawal season. Previously it was anticipated to begin the following week, which would have been a very late start for Lower-48 withdrawals.

Since fundamentals still appear loose heading into 2027, as Permian production rises sharply, this rally may prove temporary. However, if forecasts continue to cool for November, it may force more short covering from speculators, adding to near-term price gains. Again, any gains should be concentrated in the December, January, and February contracts, while the rest of the curve remains more insulated.

Meanwhile, LNG feedgas demand pushed to record highs of more than 21.5 Bcf/d this week. Gains should continue through winter as Golden Pass Train 2 begins ramping up, but the majority of new LNG feedgas demand should show up starting in the second half of 2027. One of the larger export projects, Calcasieu Pass 2 Phase 1, is apparently moving ahead of schedule. While originally guided for a startup in fall of 2027, the plant may begin receiving gas in early summer.