First Look

October 9, 2019

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  • WTI is up 49c to $53.12/Bbl, and Brent is up 56c to $58.80/Bbl
  • The Energy Information Administration (EIA) lowered its 2020 US crude production estimate by 0.5% to 13.17 MMBbl/d
    • In its monthly Short-Term Energy Outlook (STEO), the agency slightly increased its crude output forecast for 2019 by 0.2% to 12.26 MMBbl/d
    • US production growth should level off in 2020 because of lower crude prices in the first half of the year and continuing declines in well-level productivity, the agency said
  • The world economy this year will grow at its slowest pace since financial crisis of 2008-09, and the trade wars will remain a drag on growth next year, according to the IMF’s new executive director Kristalina Georgieva
    • Georgieva said her agency will revise downward its global growth projects for 2019-20 when it updates its World Economic Outlook on October 15
    • The IMF’s outlook is widely used in the modeling of key oil demand projections, including those of the International Energy Agency (IEA)
  • EIA petroleum data is due out this morning at 9:30 am CT
    • U.S. Crude Inventories:                  +      1,716 MBbls (Bloomberg surveys)
    • U.S. Gasoline Inventories:             –          334 MBbls
    • U.S. Distillate Inventories:             –      2,074 MBbls
    • U.S. Refinery Utilization:               +       0.16% change
  • Natural gas is down 1.4c to $2.274/MMBtu
  • FERC has given its approval to begin construction on the 0.6 Bcf/d Cheyenne Connector Project
    • The Cheyenne Connector will originate in the DJ Basin, specifically the Wattenberg Field, and run north to the REX Cheyenne Hub
    • The pipeline is expected to be completed in 1H2020
  • U.S. LNG companies exported 158 Bcf in September, a new record (Platts)
    • Growth in exports was bolstered by Freeport LNG, which appears to have overcome any mechanical issues and is now in the process of loading its third cargo
    • Feed gas demand came in just under 6.0 Bcf/d
  • Pacific Gas & Electric is shutting off power to 29 counties in the Bay Area and Northern California due to threats of wildfires
    • The preventative blackouts could impact approximately 800,000 customers
    • Should the outages go into effect, California and surrounding area spot prices may be negatively impacted in the near term