Coquest Daily Energy Report for February 26, 2024

Posted on 2024-02-26

Crude Oil futures for April settled up $1.09, or 1.43%, at $77.58. Recent weeks have seen a rise in physical crude prices, reaching the peak levels for the year. Refineries with strong margins are actively buying more barrels, and overseas buyers are turning to American crude to circumvent shipping challenges in the Red Sea. Moreover, protests have resulted in the suspension of exports from a western Libyan oil field and the closure of a subsea natural gas link to Italy. Investors are keenly awaiting U.S. inflation data, providing insights into potential interest rate adjustments by the Federal Reserve. Despite Middle East tensions and OPEC supply constraints, the oil market has maintained stability, thanks to increased production from non-OPEC countries like the U.S., counterbalancing these factors.


Natural Gas futures for April settled up $.045 or 2.65% at $1.744. U.S. natural gas prices exhibited an upward trend on Monday, as market participants assess the consequences of recent cuts in production. The potential bullish sentiment stems primarily from Chesapeake Energy Corp.'s substantial reduction in its 2024 production, aimed at addressing challenges related to low prices and oversupply. This strategic move significantly influences market sentiment and pricing dynamics. The upcoming weather patterns, characterized by warmer conditions across the U.S. and increased wind energy generation, are also contributing to this trend. The rise in prices at the start of the week seems more related to the observed decline in U.S. production than to extreme cold weather.


View full report here.