OIL, NATURAL GAS

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Re: OIL, NATURAL GAS

Post by thelivyjr » Thu Sep 09, 2021 1:40 p

RIGZONE

"Oil Backtracks After China Taps Strategic Reserve"


by Bloomberg | Jessica Summers and Sheela Tobben

Thursday, September 09, 2021

Oil fell by the most in nearly three weeks after China decided to tap its crude reserves to ease a surge in energy costs.

Futures declined 1.7% in New York on Thursday, following the latest step by the world’s largest importer of raw materials to quell a commodities rally.

Oil prices briefly rose earlier in the session after a U.S. government report showed crude stockpiles fell as production tumbled the most on record last week due to disruptions by Hurricane Ida.

“Additional supply coming from the Chinese SPR -- reducing the need to import more oil in the near term -- has weighed on prices,” said Giovanni Staunovo, a commodity analyst at UBS Group.

In recent days, U.S. benchmark crude has fluctuated near $69 a barrel, with investors weighing the impact of domestic supply disruptions against uncertainty over demand as the pandemic continues to rage.

China’s move to release oil from its strategic reserves, its most dramatic intervention yet in the oil market, primarily targets domestic refining and chemical firms.

It follows similar action the government has already taken in several other commodities markets and adds pressure to oil prices.

In a late statement on Thursday, the National Food and Strategic Reserves Administration said the country had tapped its giant oil reserves to “to ease the pressure of rising raw material prices.”

A sustained decline in prices demonstrates the market thinks China will keep using their strategic reserves to drive prices down, according to Phil Flynn, senior market analyst at Price Futures Group.

Prices:

West Texas Intermediate for October delivery fell $1.16 to settle at $68.14 a barrel in New York.

Brent for November settlement dropped $1.15 to end the session at $71.45 a barrel.

As of Thursday, nearly three-fourths of U.S. Gulf of Mexico oil output was still offline after Hurricane Ida hit Louisiana, marking a slower comeback than in the wake of Katrina in 2005.

The ripple effects in the market were apparent in the EIA report.

Gasoline stockpiles fell by more than 7 million barrels last week, while crude production slid by 1.5 million barrels a day.

Crude inventories dropped 1.53 million barrels.

Physical markets have reacted to the Gulf of Mexico outages with a surge in the value of grades from U.S. Mars Blend to Russia’s Urals.

Royal Dutch Shell Plc declared force majeure on “numerous contracts” following hurricane-related disruptions, the company said.

One of those contracts included a 2-million-barrel cargo of Mars crude sold to China, according to people with knowledge of the matter.

(With assistance from Alfred Cang, Saket Sundria and Paul Burkhardt.)

https://www.rigzone.com/news/wire/oil_b ... 9-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Fri Sep 10, 2021 1:40 p

RIGZONE

"Oil Up for Third Week as USA Refinery Restarts Outpace Production"


by Bloomberg | Mike Jeffers and Sheela Tobben

Friday, September 10, 2021

Oil gained a third week as investors focused on the ongoing production shut-ins in the U.S. Gulf of Mexico as more refineries have resumed operations nearly two weeks after Hurricane Ida tore through the region.

Futures in New York posted its longest set of weekly gains since July after ending Friday 2.3% higher.

More than a million barrels a day of U.S. offshore crude production remains shut in after Ida swept through the area nearly two weeks ago.

Meanwhile, more Louisiana refineries are resuming operations, raising demand for crude oil.

The slow return of offshore production led to Exxon Mobil Corp. to secure approval for a second load of crude from the Department of Energy’s Strategic Reserves for use at Baton Rouge plant.

“The market is now laser focused on the supply situation in the U.S.,” said Andrew Lebow, senior partner at Commodity Research Group.

“The losses from the extended outage in the Gulf are being felt more.”

Even after China made an unprecedented move to intervene in oil markets this week, crude in New York has traded in a $4 band since late August.

The market has been pulled in different directions with the majority of Gulf of Mexico production still shut from Hurricane Ida and falling American stockpiles acting as bullish triggers, countered by the ever-present pandemic.

Marathon Petroleum’s 578,000-barrel-a-day refinery in Garyville, Louisiana, is back in operation for the first time since before Ida slammed into the coast.

Exxon Mobil Corp. secured another 1.5 million barrels for the Strategic Petroleum Reserve for its Baton Rouge refinery, which was operating normally as of Thursday.

Prices:

West Texas Intermediate for October delivery climbed $1.58 to settle at $69.72 a barrel in New York.

Brent for November settlement rose $1.54 to $72.99 a barrel.

China’s bold but vague declaration to release oil reserves from its massive strategic stockpiles has some traders questioning the lasting impact of such a move by the world’s biggest crude importer.

The National Food and Strategic Reserves Administration also said this week that a “normalized” rotation of crude oil in the state stockpiles is “an important way for the reserves to play its role in balancing the market,” indicating that it may continue to release barrels.

It added that putting reserves on the market through open auctions “will better stabilize domestic market supply and demand.”

“China’s SPR is very healthy because they bought so much last year when prices were significantly lower,” said Lebow.

“They may wait to replenish it.”

(With assistance from Saket Sundria and Rakteem Katakey.)

https://www.rigzone.com/news/wire/oil_u ... 4-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Mon Sep 13, 2021 1:40 p

RIGZONE

"Oil Finishes on a Six Week High"


by Bloomberg | Sheela Tobben

Monday, September 13, 2021

Oil closed above $70 a barrel for the first time in nearly six weeks as another heavy storm heads to the U.S. Gulf of Mexico, while producers are still reeling from Hurricane Ida.

Futures in New York settled 1.1% higher.

Tropical Storm Nicholas, which may reach hurricane strength before it makes landfall, is expected to bring flooding rains to Houston, as well as parts of Louisiana still recovering from Hurricane Ida two weeks ago.

About 44% of oil supply is down in the Gulf and the volume of shut-in output may start growing once again.

Shell has already began removing some staff from one of its platforms to prepare for the storm.

Refineries and terminals Texas could also see some curtailments, given the storm’s coastal track.

“The threat of more disruptions from extreme weather is also a cause of concern for producers and a reason for traders to add price premiums, as the new Tropical Storm Nicholas in the Gulf of Mexico could turn into a hurricane and hit Texas in coming days,” said Nishant Bhushan, an oil markets analyst for industry consultant Rystad Energy.

With crude prices steadily climbing higher this month, major Wall Street banks are assessing the crude market.

Goldman Sachs Group Inc. said oil will likely lead a rally in commodities next quarter amid strong demand and “growing scarcity” of supply.

Bank of America Corp. said a colder-than-expected winter could push prices up toward $100 at some point early next year.

Meanwhile, OPEC on Monday forecast stronger demand for its crude this year and next amid rising global fuel use and output disruptions from the North Sea to the U.S.

The group’s monthly report indicated that the world will continue to face a supply deficit in coming months even as OPEC nations revive idle production.

Prices:

West Texas Intermediate crude futures rose 73 cents to settle at $70.45 a barrel in New York time.

Brent advanced 59 cents to $73.51 a barrel, after earlier jumping 1.4%.

“The broader global oil-demand picture is showing signs of normalizing,” said Stephen Brennock, an analyst at brokerage PVM Oil Associates.

“As OPEC+ is firmly in control of supply, and maintaining its cautious stance, the crude market should continue to tighten further in the year-end period.”

Traders are also awaiting additional import quotas for China’s private refiners, which could spur renewed purchases in the physical market in the coming weeks.

One company was granted permission to import a set volume of crude last week, and quotas for other refiners are expected imminently.

Separately, the Energy Information Administration sees more gains in tight oil production from the U.S.

Combined, major shale regions should add 66,000 barrels a day to produce 8.135 million barrels a day, but remain short of pre-pandemic highs.

(With assistance from Sharon Cho and Alex Longley.)

https://www.rigzone.com/news/wire/oil_f ... 4-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Tue Sep 14, 2021 1:40 p

RIGZONE

"Oil Steady In Wake of Hurricane Nicholas"


by Bloomberg | Sheela Tobben

Tuesday, September 14, 2021

Oil ended the session little changed as investors tracked U.S. dollar movements and concerns faded around Hurricane Nicholas’ threat to crude supply in the U.S. Gulf of Mexico.

Futures in New York erased nearly all gains, yet still managed to close at the highest since early August on Tuesday.

The dollar advanced, reducing the appeal of commodities priced in the currency.

While Nicholas did not impact offshore output in the U.S. Gulf, storm-related power outages briefly shut the country’s largest gasoline pipeline that sends fuel from Houston to the Northeast.

U.S. crude futures have traded near $70 a barrel for most of this month.

The International Energy Agency said on Tuesday that the world will have to wait until October for additional oil supplies as output losses from Hurricane Ida wipe out increases from OPEC+.

Global oil demand has been falling since July as rising Covid-19 cases prompt mobility restrictions in Asia, according to the IEA.

Nicholas, which struck shore as a Category 1 hurricane and has since lost strength, had largely moved east from the Houston area by mid-morning local time, allowing refiners, chemical makers and other industrial concerns to assess the physical impacts of rain and wind.

The gasoline crack spread, a rough measure of the profit from refining crude into fuel, rallied about 3% on the temporary outage of Colonial’s Pipeline Co.’s gasoline pipeline.

The company’s diesel pipeline is still shut.

Prices:

West Texas Intermediate for October delivery added 1 cent to settle at $70.46 a barrel in New York.

Brent for November settlement rose 9 cents to end the session at $73.60 a barrel.

Meanwhile, China said it will make the first sale of oil from its strategic reserves on Sept. 24 after announcing the historic move last week.

The initial auction will be for about 7.38 million barrels of crude, the National Food and Strategic Reserves Administration said in a statement Tuesday.

There are also signs of a stronger physical market, with Chinese companies buying grades from Brazil and Russia at higher premiums than a month earlier.

The purchases come amid speculation that authorities are about to allocate more import quotas.

(With assistance from Alex Longley.)

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Re: OIL, NATURAL GAS

Post by thelivyjr » Tue Sep 14, 2021 1:40 p

Investing.com

"Oil Inventories Fell by 5.44M Barrels Last Week: API"


Sep 14, 2021

Investing.com - U.S. crude stockpiles fell by more than expected last week, tumbling by almost 5.5 million barrels amid continued fallout from production outages caused by Hurricane Ida, figures from the American Petroleum Institute showed.

U.S. crude inventories decreased by 5.437 million barrels for the week ended Sept. 10.

That compared with a draw of 2.88 million barrels reported by the API for the previous week.

Analysts were expecting a draw of about 2.4 million barrels.

The API also showed that gasoline inventories declined by 2.76 million barrels last week, while distillate stocks fell by 2.89 million.

The official government inventory report due Wednesday is expected to show weekly U.S. crude supplies declined by about 3.54 million barrels last week.

West Texas Intermediate, the benchmark for U.S. crude, climbed to $70.67 a barrel on the news, after settling up 1 cent to $70.46 a barrel.

https://www.investing.com/news/commodit ... pi-2616260

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Re: OIL, NATURAL GAS

Post by thelivyjr » Wed Sep 15, 2021 1:40 p

RIGZONE

"Oil Surged Higher Wednesday"


by Bloomberg | Sheela Tobben

Wednesday, September 15, 2021

Oil jumped to the highest in six weeks amid signs of a rapidly tightening market after a U.S. government report showed a bigger-than-expected decline in crude stockpiles.

Futures in New York surged 3.1% on Wednesday and global benchmark Brent closed above $75 a barrel for the first time since July.

U.S. crude supplies hit the lowest since September 2019 after falling by more than 6 million barrels, exceeding projections.

The data follow the International Energy Agency’s warning that recent supply lost from storms in the U.S. Gulf have offset what OPEC and its allies have added, and the world will have to wait until October for more barrels.

“There’s not a lot of new crude supply coming to the market, so the market feels awfully tight,” said Matt Sallee, who helps manage about $8 billion at Tortoise.

“That will keep crude prices moving higher."

"Covid demand worries are taking a backseat for now.”

Prices have steadily climbed since late August and were given a further boost when Hurricane Ida shut down a chunk of U.S. Gulf Coast offshore oil production.

Meanwhile, the latest analysis from the Organization of Petroleum Exporting Countries shows a looming supply crunch in the summer of 2022.

OPEC’s analysts now see global oil demand increasing by 4.15 million barrels a day in 2022, compared to the level expected for this year, an upward revision of 860,000 barrels a day from what they forecast a month ago.

Prices:

West Texas Intermediate for October delivery advanced $2.15 to settle at $72.61 a barrel in New York.

Brent for November settlement rose $1.86 to end the session at $75.46 a barrel on the ICE Futures Europe exchange.

U.S. supply restraints have caused Brent and WTI benchmark crude’s so called timespreads to strengthen.

WTI crude for December delivery settled at $6.23 a barrel higher than that for supply in the same month next year.

That’s the biggest premium in more than a month.

The Energy Information Administration report also showed that national gasoline and distillate inventories each declined by nearly 2 million barrels.

A sharper drop would have likely occurred had petroleum consumption not been affected by recent U.S. Gulf Coast storms.

Additionally, offshore natural gas production has been slow to recover since the recent storms, causing prices to rally.

That might prompt power companies to use petroleum products such as fuel oil to run as feedstock in their plants, according to Sallee.

“That will buoy crude prices even higher,” he said.

(With assistance from Saket Sundria and Alex Longley.)

https://www.rigzone.com/news/wire/oil_s ... 3-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Thu Sep 16, 2021 1:40 p

RIGZONE

"Oil Clears Early Losses as Dollar and Expirations Impact Trading"


by Bloomberg | Alex Longley and Sheela Tobben

Thursday, September 16, 2021

Oil ended the session unchanged after choppy trading with traders focused on adjusting positions in U.S. crude options ahead of expiration.

Futures in New York closed flat on Thursday after earlier declining as much as 1.5% amid a U.S. dollar rally.

Nearly 312 million barrels of Nymex front-month West Texas Intermediate crude options, instruments used by investors to hedge their positions in the futures market, are set to expire on Thursday.

“The earlier sell-off in oil futures was in response to the dollar rallying."

"But now, the market is meeting some position-squaring before WTI options expiry today that is erasing some of those declines,” said Spencer Vosko, director for crude oil at Black Diamond Commodities LLC in Houston.

Crude futures this month have been supported by signs of tightening U.S. inventories after storms swept through the U.S. Gulf of Mexico, crippling the energy industry.

The global oil market should remain tight through the end of the year despite planned production increases by OPEC+ producers, in part from those storm-related outages, as it will take some time for a full recovery, according to Commerzbank AG.

Prices:

West Texas Intermediate crude for October settled unchanged at $72.61 a barrel in New York.

Brent for November settlement added 21 cents to end the session at $75.67 a barrel.

The investor optimism is also showing up in the widening of key oil timespreads into a stronger bullish backwardation structure.

For example, West Texas Intermediate crude for December delivery jumped to the widest premium to the December 2022 contract since July.

Strong prices for gas, liquefied natural gas and oil are expected to last “for a while” as producers resist the urge to drill again, Chevron Corp.’s Chief Executive Officer Mike Wirth told Bloomberg.

Norway’s Equinor ASA said Thursday it also expects European gas prices to remain high over winter.

(With assistance from Sharon Cho.)

https://www.rigzone.com/news/wire/oil_c ... 2-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Fri Sep 17, 2021 1:40 p

RIGZONE

"Oil Drops Friday But Up On The Week"


by Bloomberg | Sheela Tobben

Friday, September 17, 2021

Oil declined amid Russia’s plans to boost upcoming overseas oil sales and as the dollar rallied.

Futures in New York ended the session nearly 1% lower on Friday.

Russia will increase its oil exports 3% in the fourth quarter, according to Interfax.

Meanwhile, gains in the U.S. dollar reduced investor interest in commodities priced in the currency.

“There’s been demand destruction starting with higher prices across energy markets broadly and there’s Russian’s plans to raise its global oil sales,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Management.

Despite weaker prices on Friday, U.S. benchmark crude futures gained more than 3% this week due to tightening supplies.

In the U.S., crude inventories tumbled to the lowest level since 2019 and fuel supplies also fell, according to government data this week.

Investors have been tracking strong rallies in other energy commodities as well, especially natural gas, which has surged by about 45% so far this quarter and spurred the prospect of fuel switching.

But as prices climb there are increasing signs governments are growing uneasy with the knock-on effects.

U.S. President Joe Biden said Thursday that his administration is looking into high gasoline prices, while China said this week that it will sell oil from its strategic reserve.


Prices:

West Texas Intermediate crude futures for October delivery fell 64 cents to settle at $71.97 a barrel in New York.

Brent for November settlement dropped 33 cents to end the session at $75.34 a barrel.

Growing supply tightness has made crude markets more backwardated, bullish pattern with near-dated prices more expensive than those further out.

Meanwhile, products like propane that are used in heating and rally seasonally in the winter are trading at multiyear highs as natural gas prices surge.

“Fundamentals have gotten better and as long as they continue to improve, oil prices will rise,” said Peter McNally, global head of industrials, materials and energy at Third Bridge.

“We have not hit a ceiling yet.”

With the focus on high energy prices across Europe, the International Energy Agency’s Executive Director Fatih Birol said gas prices could remain high for weeks to come on strong demand.

He also said he would be surprised to see oil above $100 a barrel, despite a strong rebound in demand this year.


(With assistance from Sharon Cho and Alex Longley.)

https://www.rigzone.com/news/wire/oil_d ... 3-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Mon Sep 20, 2021 1:40 p

RIGZONE

"Oil Down With China Demand Concerns"


by Bloomberg | Sheela Tobben

Monday, September 20, 2021

U.S. crude futures slid 2.3% to settle at the lowest level in more than a week as worries mounted over a possible implosion in the Chinese property sector that could impact the Asian giant’s appetite for crude.

A stronger U.S. dollar is also making commodities priced in the currency less attractive.

“China is the global swing demand center,” said John Kilduff, a partner at Again Capital LLC.

“If we lose China, we will lose much of the recent oil price gains.”

Crude prices have fared well so far this month -- U.S. oil futures are up about 4% in September -- in part due to lingering supply disruptions from storms that have swept through the U.S. Gulf of Mexico.

Royal Dutch Shell Plc said some critical U.S. Gulf of Mexico oil-production assets for Mars crude supply will be out of service for the rest of this year.

While oil fundamentals are pointing to higher prices, a planned U.S. Federal Reserve meeting this week could signal the central bank is moving toward scaling back asset purchases, possibly weakening global crude oil benchmarks.

Prices:

West Texas Intermediate for October delivery dropped $1.68 to settle at $70.29 a barrel in New York.

Brent for November settlement fell $1.42 to settle at $73.92 a barrel.

Investors are also continuing to monitor the energy crunch in Europe amid talk of switching from gas to oil.

There are expectations diesel demand will expand in Asia during winter, while the use of oil to generate power in the U.S. may jump.

(With assistance from Alex Longley and Elizabeth Low.)

https://www.rigzone.com/news/wire/oil_d ... 8-article/

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Re: OIL, NATURAL GAS

Post by thelivyjr » Tue Sep 21, 2021 1:40 p

RIGZONE

"Oil Up As Tight Supply Wins Over Chinese Economic Worries"


by Bloomberg | Sheela Tobben

Tuesday, September 21, 2021

Oil ended modestly higher after a choppy session as concerns over growing tight supply outweighed fears over the state of China’s economy.

Futures in New York closed 0.4% higher, posting the first gain in nearly a week as traders focused on growing supply constraints in the U.S. Gulf of Mexico following lasting damage from Hurricane Ida and as large oil companies work to reduce their carbon footprint.

These trumped worsening financial troubles at China’s Evergrande Group, which could spill into the rest of the property sector and threaten the country’s economy.

“There are supply issues all around the market,” said John Kilduff, a partner at Again Capital LLC.

Oil has resumed its advance over the past month, in part due to a tightening of the market following lingering supply disruptions from U.S. storms.

At the same time, consumption is coming into focus in anticipation that soaring natural gas prices will force a shift toward oil.

Meanwhile, the lifting of U.S. travel restrictions could add as much as 200,000 barrels a day of jet fuel demand, according to Energy Aspects Ltd.

Some of the volatility in Tuesday’s trading session may have stemmed from traders adjusting positions ahead of the expiration of Nymex October crude futures.

Prices:

West Texas Intermediate for October, which expired Tuesday, rose 27 cents to settle at $70.56 a barrel in New York.

Brent for November delivery added 44 cents to settle at $74.36 a barrel.

As the Organization of Petroleum Exporting countries continues to lift output, two key members said the group should carry on ramping up supply as planned.

The alliance, led by Saudi Arabia and Russia, will meet on Oct. 4 to review the next monthly increment of 400,000 barrels a day.

Investors will also be looking toward oil inventory data from the industry-funded American Petroleum Institute for guidance on where supplies stand across the U.S.

Government data will be released on Wednesday.

(With assistance from Elizabeth Low, Alex Longley and Josyana Joshua.)

https://www.rigzone.com/news/wire/oil_u ... 1-article/

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