April 15, 2019

By April 16, 2019First Look

April 15

Crude Oil:

  • WTI is down 56c to $63.33/Bbl, and Brent is down 60c to $70.95/Bbl
  • Money Managers raised their bullish bets on Brent crude for the fifth straight week
    • Short positions were also dropped
    • Long contracts for WTI were also increased, rising to 300,000 contracts
      • The last time funds were at this bullish was back in Oct. 2018
  • Concho Resources and Frontier Midstream Solutions IV LLC agreed to form a 50-50 joint venture to build a crude pipeline system in the Permian Basin (Bloomberg)
    • The JV, Beta Crude Connector LLC (BCC), will be operated by Frontier and will be expected to deliver 150 MBbl/d from the Permian
      • The system will provide crude oil gathering, transportation and storage services in the Northern Midland Basin
      • Crude is expected to flow in mid-2019
  • US Treasury Secretary Steve Mnuchin said the US and China are making progress in talks to end their nine-month trade and tariff war (Bloomberg)
    • While talking to reporters in Washington, Mnuchin said that under the pact being discussed, the US and China would each establish an “enforcement office” to monitor compliance
    • He is hopeful that both nations are very close to the final round of talks
    • AEGIS notes trade war tensions between the US and China have been a cloud of uncertainty for the global economy and has weighed on crude oil prices

Natural Gas:

  • Natural gas is down 4.1c to $2.619/MMBtu
  • Weather models show warmer changes from the early weekend hold
    • Warmest changes form Friday focus on the Midwest and East
    • Demand from Friday fell 15.8 TDDs (CWG)
  • Baker Hughes gas rig count decreased by five last week, to a total of 189
    • Three rigs were added in the Utica Basin, while the Marcellus lost six rigs and Haynesville lost two rigs
  • Eagle LNG has received a final environmental impact statement from FERC to construct Jacksonville LNG export facility (LNG Industry)
    • This is the final step in the environmental review process before the final federal authorization decision deadline and anticipated FERC approval of the project
    • The proposed Jacksonville LNG project will initially consist of three liquefaction trains, which will be capable of producing up to 1.65 million gallons of LNG per day, or approximately 1 million tonnes per annum