Coquest

Your Daily Energy Report for December 4, 2024

Posted on 2024-12-04

Crude Oil

Crude Oil futures for January settled down -$1.40 or -2.002% at $68.54. Oil prices dropped on Wednesday, giving back some of the previous day's gain. This comes as traders await a crucial decision from OPEC+ regarding production policy. The group is expected to maintain its current output cuts through the first quarter of 2025, but analysts warn that the tone and specifics from Thursday's meeting could have a significant impact on prices. Despite the drop, the market found some support from a larger-than-anticipated decrease in U.S. crude stocks, as reported by the Energy Information Administration. Refinery activity increased, and inventories of gasoline and distillates grew. Geopolitical developments, such as the fragile ceasefire between Israel and Hezbollah, political unrest in South Korea following a brief martial law declaration, and the escalating conflict in Syria involving oil-producing nations, also influenced market movements.
 

Natural Gas

Natural Gas futures for January settled up $.001 or .033% at $3.043. Natural gas prices stayed steady on Tuesday, driven by forecasts for warmer weather in mid-December and increasing production, which are overshadowing the impact of the current cold snap in the U.S. Gas production continues to remain strong, surpassing 103 Bcf/d. While near-term demand has been solid due to frigid weather systems bringing rain, snow, and freezing temperatures across regions like the Midwest, Ohio Valley, and the Eastern U.S., updated weather models suggest a shift toward milder conditions by mid-December, reducing expectations for sustained demand. The most recent EIA Weekly Storage Report showed a slight drop of 2 Bcf, leaving the total working gas in storage at 3,967 Bcf as of November 22, 2024.


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