Coquest Daily Energy Report for April 08, 2024

Posted on 2024-04-08

Crude Oil futures for May settled down -$.48 or -.55% at $86.43. Oil prices experienced a decline on Monday, marking the end of a consecutive upward trend, following Israel's decision to reduce its military presence in southern Gaza and initiate new discussions for a ceasefire with Hamas. Despite ongoing talks, Hamas indicated a lack of progress in negotiations. Market sentiment shifted with Israel's troop reduction, contributing to a drop in both benchmark prices. Additionally, expectations of an increase in U.S. crude oil inventories added pressure on oil prices. The U.S. employment report released on Friday, signaling a strong economic performance in the first quarter, raised speculations about a potential delay in interest rate cuts by the Federal Reserve, further influencing oil demand outlook. Investors will scour consumer price index data from the U.S. and China this week for further clues on economic health of the world's top two oil consumers.


Natural Gas futures for May settled up $.059 or 3.31% at $1.844. US natural gas futures surged beyond $1.8/MMBtu fueled by anticipations of heightened demand this week and continued cutbacks in gas production. Earlier this year, gas prices plummeted to their lowest levels in over three years, prompting drilling firms to scale down operations, notably in regions like the Haynesville shale basin. Activity in the Haynesville shale witnessed a decline in active drilling rigs, with only 34 rigs presently operational, marking the lowest count since August 2020. Moreover, electric grids nationwide are gearing up for an upcoming total solar eclipse, expected to temporarily diminish solar power generation, thereby bolstering the necessity for gas-powered electricity.


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