Coquest

Your Daily Energy Report for January 2, 2025

Posted on 2025-01-02

Crude Oil

Crude Oil futures for February settled up $1.41 or 1.966% at $73.13. Oil prices rose on Thursday, marking their highest level since October. This increase was driven by positive sentiment regarding oil demand and a recent report indicating a decline in US crude inventories. Confidence in China’s economic recovery, highlighted in President Xi Jinping’s New Year address, added to the market's optimism despite global challenges. Furthermore, China's manufacturing sector experienced slight growth for the third straight month, boosting expectations for robust oil consumption. China’s economic recovery remains uncertain, with recent data showing factory activity slowed its pace of expansion in December. The rapid adoption of electric vehicles and renewable fuels also is chipping away at gasoline demand. The price surge was further supported by EIA data revealing a 1.178 million barrel decrease in US crude stockpiles last week, the sixth consecutive weekly drop.
 

Natural Gas

Natural Gas futures for January settled up $.027 or .743% at $3.660. Natural gas prices increased slightly today, driven by increasing shipments to LNG export facilities and forecasts of colder temperatures and elevated heating demand in the coming weeks. Weather predictions indicate a shift from near-average conditions to below-normal temperatures between January 6 and 17, likely raising heating needs. Additionally, gas deliveries to the nation’s major LNG export terminals have been on the rise and are expected to grow further, especially after the end of an agreement that allowed Russian gas exports to Europe via Ukraine. However, LNG feedgas volumes experienced a slight decline in 2024, marking the first yearly decrease since US LNG exports began in 2016.

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