Your Daily Energy Report for July 17, 2024
Posted on 2024-07-17
Crude Oil
Crude Oil futures for August settled up $2.09 or 2.588% at $82.85. Oil prices rose on Wednesday, spurred by a larger-than-anticipated decrease in U.S. crude inventories and a weakening U.S. dollar, despite indications of slower economic growth in China. According to the Energy Information Administration, 4.9 million barrels of crude were drawn from U.S. storage for the week ending July 12, surpassing the 30,000-barrel drop predicted by analysts in a Reuters poll and the 4.4 million-barrel reduction reported by the American Petroleum Institute. On the other hand, gasoline and distillate stockpiles unexpectedly increased. Geopolitical factors also played a role in supporting prices, with an attack on a Liberia-flagged tanker by Yemen's Houthis in the Red Sea. However, gains were tempered by China's economic deceleration, with second-quarter growth at 4.7%, the weakest since early 2023, raising concerns about demand.
Natural Gas
Natural Gas futures for August settled down -$.153 or -6.993% at $2.035. Natural gas futures declined sharply today, driven by expectations of milder weather and reduced feedgas to LNG export facilities after Freeport LNG shut down due to Hurricane Beryl. The market also faced pressure from persistent oversupply, with storage levels well above seasonal norms. Meteorologists anticipate typical weather patterns across the contiguous United States until late July, followed by above-average temperatures into early August. Despite this outlook, LSEG predicts a decline in average gas demand from 105.5 bcfd this week to 103.5 bcfd next week. Gas deliveries to US LNG export terminals decreased in June, largely due to operational disruptions at Freeport LNG and reduced activity at Cheniere Energy's Corpus Christi facility