Outlook: Energies are again trading higher to start the morning for the third consecutive session this week. WTI barely escaped with a gain yesterday after a significantly larger-than-expected crude build posted in an industry survey yesterday afternoon. The EIA returns to its regular release schedule this week and will have official government data out at 9:30 CT. The EIA released its STEO report for January yesterday, which included 2024 forecasts. The EIA expects crude prices to fall further into 2024 and a positive response from demand in reaction to the lower pricing. They expect Brent crude to average $77.57 in 2024, down from $83.10 in 2023. WTI crude currently trades at just under a $5 dollar discount to Brent
Crude
- The EIA released its Short-Term Energy Outlook for January which included the first forecast for 2024.
- The EIA forecasts that US crude production will average 12.8 mbpd in 2024, up from 12.4 mbpd in 2023.
- The EIA forecasts that US liquid fuel consumption will increase by 200,000 bpd between 2023 and 2024.
- The US House of Representatives is set to vote this week on ending sales of the US SPR to China.
- Kazakhstan is reportedly set to send its first pipeline shipments of crude to Germany this month.
- The Kremlin said today that it had not yet seen any cases of price caps on Russian oil imposed by the West last month.
- Reuters estimates crude stocks fell by 2.2 million barrels last week.
- Crude stocks rose by 14.9 million barrels last week, according to sources citing the API.
- The EIA will report official inventory stats at 9:30 CT.
- As of 7.56 am CST: Brent crude oil up $1.41 to $81.51, US dollar index up $0.097 to 103.333 while the nearby e-mini S&P 500 futures contract is up 14.25 to 3955.00.
Diesel
- Reuters estimates diesel stocks fell 500,000 barrels last week.
- Distillate stocks rose by around 1.1 million barrels last week, according to sources citing the API.
Gasoline
- Reuters estimates gasoline stocks rose by 1.2 million barrels last week.
- Gasoline stocks rose by around 1.8 million barrels last week, according to sources citing the API.
Propane
- Conway is trading at .7700 while Belvieu is trading at .7925.
- Conway is trading at 43% of crude.
- The US is exporting 74% of production as of 12/30/22.
Natural Gas
- Total US gas demand fell to 111.3 Bcf/d.
- Total US dry production fell to 97.3 Bcf/d.
- Overnight weather runs added 5 HDDs through the two-week forecast.
- The EIA expects Freeport LNG to be running by the end of the month.
Continuous Daily RBOB: The prompt gasoline contract is testing its 50-day moving average (Blue Line) after three consecutive sessions higher. A close above this level could leave the 100-day moving average (Purple Line) as its next upside target short term.
