Your Daily Energy Report for May 23, 2024
Posted on 2024-05-23
Crude Oil
Crude Oil futures for July settled down -$.70 or -.902% at $76.87. Oil prices declined for the fourth straight session on Thursday, reaching multi-month lows. The potential for prolonged high U.S. interest rates sparked concerns about demand growth in the country's oil market. Data from S&P Global indicated an increase in U.S. business activity this month, although manufacturers reported rising input prices, pointing to potential goods inflation in the coming months. Additionally, U.S. crude inventories increased by 1.8 million barrels last week, contrary to an expected decrease of 2.5 million barrels, as reported by the EIA. However, U.S. gasoline demand hit its highest level since November, offering some support to energy markets ahead of the Memorial Day holiday weekend, marking the beginning of the U.S. summer driving season. Recent weakness in crude oil prices raises the likelihood that OPEC+ will maintain its existing production curbs at least through the end of September.
Natural Gas
Natural Gas futures for July settled down $.185 or 6.51% at $2.657. On Thursday, U.S. natural gas futures fell by over 2% to under $2.8/MMBtu, retreating from a six-month high due to a rise in daily production and a storage increase reported by the EIA. Last week, U.S. utilities added 78 bcf of gas to storage, slightly below market expectations of an 84 bcf rise. The report also indicated that gas inventories are 28.8% above the five-year average. Additionally, output has grown by 0.9 bcfd since reaching a 15-week low on May 1, suggesting that some producers have increased gas production in response to higher prices. Meanwhile, gas flows to major U.S. LNG export facilities have increased in May, coinciding with the reopening of the Freeport LNG plant in Texas