May 13, 2019

By May 14, 2019First Look

May 13

Crude Oil:

  • WTI is up 95c to $62.61/Bbl, and Brent is up 123c to $71.85/Bbl
  • An senior Iran Revolutionary Guards commander said a US aircraft carrier would have been “a serious threat” to Iran in the past, but is now “opportunities,” implying US forces are a target (Reuters, ISNA)
    • US Secretary of State Mike Pompeo says in an upcoming CNBC interview movement of US seaborne forces into the area is in reponse to intelligence of possible Iranian attacks on US assets
  • Four commercial vessels were sabotaged near the Strait of Hormuz between UAE and Iran, and two vessels were from Saudi Arabia (Reuters)
    • The two Saudi vessels were oil tankers
    • In 2016, near 18.5 MMBbl/d passed through the strait in 2016, or about 30% of global petroleum seaborne trade

Natural Gas:

  • Natural gas is down 0.8c to $2.611/MMBtu
  • Weather models showed a slight gain in demand for the 15-day forecast
    • Past the 15th day, some weather models are leaning warm to hot in the East, so we will be watching a potential positive start for June gas demand
    • However, the month of June does not have patterns that threaten much heat
  • Baker Hughes gas rig count remained unchanged, with 183 gas rigs
    • One rig was lost in the Utica Basin, while the Marcellus gained two rigs and Haynesville remained the same
  • Cameron LNG requested FERC approval to commission its first cargoes (Platts)
    • An approval and commissioning would be the final step in years of permitting for the project
    • Train 1 has faced several delays due to weather and construction issues, but is finally looking to come online
    • AEGIS notes the terminal is located in in southwestern Louisiana (Hackberry) and will create demand near the Henry Hub point, with little effect on most producers’ basis pricing
  • Trade war cuts US LNG exports to China (Reuters)
    • So far this year, only two vessels have gone from the United States to China – one in January and one in February – versus 14 during the first four months of 2018 before the start of the trade conflict