Outlook: Energies are mixed this morning ahead of the EIA inventory data. Estimates are wide ahead of the report with crude expected to fall between 3 and 8 million barrels last week. Destocking in the Gulf has contributed to the crude draws as of late and that pattern will likely continue as this report will cover the last week of the year. GasBuddy has observed significant declines in gasoline demand over the last week, and this will be a data point to look out for from today’s report. Even though there’s steam for interest rates to lift this year, demand destruction remains a bearish risk with where rates stand currently. The EIA will report inventories 10:00 am CT, 30 minutes later than usual due to the Monday market holiday this week.
Crude
- The US announced intentions to purchase another 3 million barrels for the SPR for April delivery. The DOE bought back 13.8 million barrels in 2023.
- The Trans Mountain Pipeline said it won’t be able to fill its line until May if regulators reject its plan to use a smaller pipe for a section of the route.
- Venezuelan crude oil exports have risen to a 4-year high in 2023, rising 515,000 bpd. 140,000 bpd was shipped to the US.
- The FOMC meeting minutes revealed policymakers agreeing that rates should remain restrictive for “some time.”
- Reuters estimates crude stocks fell by 3.7 million barrels last week.
- The API survey showed crude stocks fell by 7.4 million barrels last week.
- The EIA will report inventories at 10:00 am CT.
- As of 8:22 am CST: Brent crude oil up $0.25 to $78.50, US dollar index down $0.018 to 102.474 while the nearby e-mini S&P 500 futures contract is down 3.25 to 4742.00.
Diesel
- Reuters estimates diesel stocks rose by 600,000 barrels last week.
- The API survey showed diesel stocks rose by 6.7 million barrels last week.
- Diesel shipments out of Russia’s Primorsk port rose 100,000 bpd to 460,000 bpd m/m.
Gasoline
- Reuters estimates gasoline stocks fell 200,000 barrels last week.
- The API survey showed gasoline stocks rose by 6.9 million barrels last week.
Propane
- Conway is trading at .6800 while Belvieu is trading at .6950.
- Conway Swap Oct24-Mar25 strip trading ~.7300.
- OPIS estimates propane stocks fell by 1 million barrels last week.
Natural Gas
- Overnight weather runs added 5 HDDs through the two-week forecast.
- The EIA will report inventories at 9:30 am CT.
- Reuters estimates natural gas stocks fell between 17 and 51 Bcf last week.
Continuous Daily NG: Natural gas prices are surging in anticipation of colder weather. Showing no respect for the 50 or 100 day moving averages, $3.00 will represent the next line of resistance if the pattern persists.
