Coquest Daily Energy Report for April 10, 2024

Posted on 2024-04-10

Crude Oil futures for May settled up $.98 or 1.149% at $86.21. Crude oil futures rose nearly $1 on Wednesday after three sons of a Hamas leader were killed in an Israeli airstrike in the Gaza Strip. The Israeli military confirmed the attack, stating that the sons were members of the Hamas armed wing. This development could complicate ceasefire negotiations and potentially involve other countries, including Iran, a key supporter of Hamas and a major OPEC producer. Earlier in the day, oil prices had fallen due to higher-than-expected increases in U.S. crude oil and fuel inventories, driven by weak demand and reduced oil exports. U.S. crude stocks rose by 5.8 million barrels in the week ended April 5, significantly surpassing analysts' projections of a 2.4 million barrel increase. Gasoline inventories unexpectedly rose by 700,000 barrels and distillate stocks by 1.7 million barrels.


Natural Gas futures for May settled up $.013 or .694% at $1.885. U.S. natural gas futures continues it's uptick today, driven by various market dynamics such as a drop in production levels, heightened LNG activity, and investor outlook. The recent surge is primarily linked to reduced natural gas production and signs of a strengthened LNG sector. Additionally, bargain hunting has contributed to the rise, especially after a decline in demand during the transition from late winter to early spring. The U.S. Energy Information Administration (EIA) has adjusted its 2024 natural gas price forecast to $2.20/MMBtu, marking a 5.2% decrease from their earlier projections. Despite this adjustment, the EIA anticipates record-breaking levels of power consumption in 2024 and 2025. Furthermore, the EIA forecasts an uptick in gas sales, particularly in power generation, while maintaining natural gas' share of power generation at 42% in 2024.


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