Coquest Daily Energy Report for April 17, 2024

Posted on 2024-04-17

Crude Oil futures for May settled down -$2.67 or -3.128% at $82.69. On Wednesday, oil prices experienced a nearly 3% decline, influenced by an increase in U.S. commercial inventories, along with weaker economic indicators from China. Additionally, developments regarding Ukraine and Israel aid bills in the U.S. contributed to the pressure on oil prices. This week has seen a softening of oil prices due to economic challenges overshadowing geopolitical tensions. Attention is also on how Israel will react to Iran's recent attack. Despite this, analysts anticipate that Iran's actions are unlikely to result in significant U.S. sanctions on its oil exports. U.S. crude inventories climbed by 2.7 million barrels to 460 million barrels last week, surpassing analysts' expectations. Meanwhile, in China, while the economy grew faster than anticipated in the first quarter, internal demand remains fragile, as indicated by several other economic metrics.


Natural Gas futures for May settled down -$.02 or -1.155% at $1.712. U.S. natural gas futures saw a decline today, marking the lowest point in two months. This decrease can be attributed to a notable reduction in feedgas supplied to LNG export facilities and a considerable surplus in storage inventories. Feedgas levels for LNG facilities hit a three-month low of 9.5 billion cubic feet per day on Tuesday, primarily due to decreased feedgas at major plants including Freeport, Cameron, Cheniere Energy's Sabine Pass, and Corpus Christi. Additionally, projections indicate that gas stockpiles will be 36% higher than the seasonal average, a result of both elevated initial storage levels and a mild winter. On the production side, U.S. gas output has declined by around 10% this year, with companies such as EQT and Chesapeake Energy postponing well completions and reducing drilling activities.


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