Your Daily Energy Report for July 1, 2024
Posted on 2024-07-01
Crude Oil
Crude Oil futures for August settled up $1.84 or 2.257% at $83.38. Oil prices reached a two-month peak on Monday, driven by anticipated demand increases during the summer driving season in the Northern Hemisphere and concerns that Middle Eastern conflicts could escalate, potentially disrupting global oil supplies. OPEC and its allies, have extended most of their oil production cuts into 2025. These reductions have led analysts to predict supply shortages in the third quarter as transportation and air-conditioning demand during the summer deplete fuel reserves. This increased demand for fuel boosted U.S. oil product prices by about 3% on Monday, with diesel futures hitting their highest point in ten weeks and gasoline futures reaching an eight-week high.
Natural Gas
Natural Gas futures for August settled down -$.123 or -4.729% at $2.478. Natural gas futures experienced a significant decline on Monday, reaching their lowest point in six weeks. Factors contributing to this decline included heightened production levels, reduced demand projections, and an excess of gas in storage. Despite ongoing high temperatures across the country, analysts pointed to ample inventories and increasing production as key drivers of the price drop. Throughout June, natural gas production in the contiguous US states averaged 98.8 bcfd, rebounding from May's low of 94 bcfd, the lowest in 25 months. Furthermore, there were maintenance-related reductions in gas flows to major US LNG export facilities during June. Feedgas deliveries to the Freeport LNG plant rebounded after a significant decline, but operational challenges persisted due to issues with the compressor system.