May 16, 2019

By May 17, 2019First Look

May 16

Crude Oil:

  • WTI is up 87c to $62.89/Bbl, and Brent is up 96c to $72.73/Bbl
  • The crude oil markets shrugged off a hefty storage build yesterday to settle 24c higher on the day
    • US crude inventories rose 5.4 MMBbl to 472 MMBbl last week
    • Crude imports last week increased by 919 MBbl/d
    • Oil exports jumped by 1 MMBbl/d to 3.3 MMBbl/d
  • Saudi Arabia and its allies struck rebel targets in Yemen in retaliation for a drone attack on a Saudi cross-country oil pipeline two days ago (Bloomberg)
    • Houthi rebels attacked a major crude oil pipeline in Saudi Arabia with drones, according to Anwar Gargash the UAE minister of state for foreign affairs
    • The Saudi prince said Iran ordered attacks on Aramco pipeline

Natural Gas:

  • Natural gas is down 0.2c to $2.599/MMBtu
  • Weather models are coalescing around a warm end to May in most of the eastern US, but a cool Midwest and Texas
    • June is still leaning cool for Texas and the Midwest, and less heat in the East
    • Pacific Northwest could see some heat, which could mitigate some of the demand being stolen from gas by hydroelectric generation
  • Waha basis has tightened to a better -$2.21/MMBtu discount to Henry Hub for June
    • Waha June basis was near -$2.35/MMBtu most of May, and as weak as -$2.46 at the end of April
    • July delivery received some small support, and November delivery has been improving since early March, currently near -$0.66/MMBtu
    • AEGIS is still mostly concerned about the 2Q2020-3Q2020 period