Power Up: Oil prices are sliding
Power Up is published on Mondays and Thursdays. Think your friend or colleague should know about us? Forward this newsletter to them. They can also subscribe here.
Sept 9 -By Liz Hampton
U.S. Energy Markets Editor
Hello Power Up readers! Oil prices have been slipping, despite ongoing geopolitical supply risk and other factors that should point to tighter markets near-term. This morning both contracts are in the red, with U.S. crudefutures trading around $67.35 a barrel and Brent at $70.68 a barrel. Natural gas is off too, even as a hurricane brewing in the Gulf of Mexico is set to hit oil and gas infrastructure later this week. Let's jump in.
Crude futures post major declines as demand jitters weigh
And a hurricane threatens U.S. oil and gas facilities
Oil prices posted a big loss over the last week, despite ongoing disruptions to supply in Libya, a major drawdown in U.S. crude inventories, and OPEC+'s decision to delay a planned output increase by two months.
Brent ended down 10%for the week, settling at $71.06 a barrel on Friday - its lowest level since Dec. 2021. West Texas Intermediate (WTI) shed 8% for the week and ended at $67.67 a barrel.
Late last week, Libya declared a force majeure on several crude cargoes as production has been curtailed amid a political standoff over the central bank and oil revenue.
Meanwhile, U.S. crude inventories fell by nearly 7 million barrels in a weekand hit a one-year low.
While all of these factors should be supportive for prices, they haven't been. Oil futures are down again today, even as the U.S. Gulf Coast is bracing for a potentialhurricane that couldimpact some oil and gas infrastructure this week.
The weather system is anticipated to make landfall along the Louisiana coast as a Category 1 storm, with several liquefied natural gas plants in its path. Shell has alreadypaused some operations offshore as the storm approaches.
Even so, natural gas prices are down today at roughly $2.19 per million British thermal unit, down more than 4%.
Demand concerns appear to be keeping a cap on prices, with the market closely watching weakness in the Chinese economy and a shift to lower carbon fuels.
In theU.S. oil consumption slowed in June to its lowest seasonal level since the coronavirus pandemic of 2020, the U.S. Energy Information Administration said in its monthly supply and demand report in August.
Demand concerns have also hit the fuels market hard, with U.S. gasoline futures slumping to near a three-year lowlast week. In Asia, refining margins are at their lowest seasonal level since 2020 as supplies have jumped.
The market is bracing for lower prices. Bank of America Global Research on Friday loweredits 2025 Brent forecast by $5 to $75, pointing to weaker demand, particularly from China, as well as growing inventories.
Trading houses Gunvor and Trafigura, meanwhile, expect oil prices to range between $60 and $70 due to sluggish Chinese demand and oversupply, executives said at the APPEC conference in Singapore.
ESSENTIAL READING
Russia revised upwards its 2024 forecastsfor export sales of oil and gas by $17.4 billion amid a more positive price outlook. It had previously estimated $239.7 billion. The upward revision underscores the struggle the West has faced in inflicting damage on the Russian economy through sanctions.
Fuel oil cargoes bound for the U.S. Gulf Coast hit over a five-year low last month in a sign of weakened refinery demand as margins have softened, Georgina McCartney reports. Lower Mexican imports largely drove the decline.
New England states Massachusetts and Rhode Island are moving ahead with three offshore wind projects totaling 2.9 gigawatts (GW), government officials said on Friday. The projects are set to begin delivering power around the end of the decade.
Automaker BMW is aiming to bring its first hydrogen-powered vehicle into the market in 2028 using a technology developed with Toyota Motor. The vehicle will be an existing model with a hydrogen fuel cell drive option.
French nuclear fuel company Oranocould begin enriching uranium at a new plant in the U.S. by the early 2030s, executives said on Friday, a move that would boost its share in the global market as the U.S. weans itself off Russian supplies.
We hope you're enjoying the Power Up newsletter. We'd love to hear your thoughts and feedback. You can reach us at: powerup@thomsonreuters.com.
Editing by Marguerita Choy
免責聲明: XM Group提供線上交易平台的登入和執行服務，允許個人查看和/或使用網站所提供的內容，但不進行任何更改或擴展其服務和訪問權限，並受以下條款與條例約束：（i）條款與條例；（ii）風險提示；（iii）完全免責聲明。網站內部所提供的所有資訊，僅限於一般資訊用途。請注意，我們所有的線上交易平台內容並不構成，也不被視為進入金融市場交易的邀約或邀請 。金融市場交易會對您的投資帶來重大風險。
所有缐上交易平台所發佈的資料，僅適用於教育/資訊類用途，不包含也不應被視爲適用於金融、投資稅或交易相關諮詢和建議，或是交易價格紀錄，或是任何金融商品或非應邀途徑的金融相關優惠的交易邀約或邀請。
本網站的所有XM和第三方所提供的内容，包括意見、新聞、研究、分析、價格其他資訊和第三方網站鏈接，皆爲‘按原狀’，並作爲一般市場評論所提供，而非投資建議。請理解和接受，所有被歸類為投資研究範圍的相關内容，並非爲了促進投資研究獨立性，而根據法律要求所編寫，而是被視爲符合營銷傳播相關法律與法規所編寫的内容。請確保您已詳讀並完全理解我們的非獨立投資研究提示和風險提示資訊，相關詳情請點擊 這裡查看。
