Coquest

Your Daily Energy Report for December 23, 2024

Posted on 2024-12-23

Crude Oil

Crude Oil futures for February settled down -$.22 or -.317% at $69.24. Oil prices slipped on Monday, as worries about a potential supply glut in 2025 and a stronger US dollar put pressure on the market in the pre-holiday period. Experts pointed to the possibility of an expanding supply surplus next year, while the dollar's rise to a two-year high made oil more expensive for international buyers. Some relief came with the reopening of the Druzhba pipeline, which resumed oil deliveries from Russia and Kazakhstan to parts of Europe following the resolution of technical problems. A slowdown in US inflation provided some hope, though the Federal Reserve's unclear stance on monetary policy kept market sentiment cautious. Additionally, Sinopec’s projection that China's oil consumption may peak by 2027 weighed on long-term demand outlooks. Geopolitical tensions increased as Donald Trump urged the EU to increase US energy imports or face tariffs, and criticized Panama’s canal fees, prompting a strong reaction from Panama's president.
 

Natural Gas

Natural Gas futures for January settled down -$.092 or -2.455% at $3.656. Natural gas prices broke a four-day winning streak, experiencing volatile trading after reaching a two-year peak. Weather remains a key factor driving these price fluctuations, with storage levels posing a risk of shifting from a long-standing surplus to a potential deficit compared to last year. LNG exports continue to exert pressure on supply, with feed gas demand reaching 15 Bcf/d as European and Asian buyers secure shipments. Moreover, concerns over freeze-offs in the Gulf of Mexico and northern production areas are creating additional uncertainty regarding output, further supporting bullish market sentiment.

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