Your Daily Energy Report for September 3, 2024
Posted on 2024-09-03
Crude Oil
Crude Oil futures for October settled down -$3.21 or -4.364% at $70.34. Oil prices experienced a significant decline on Tuesday, reaching their lowest levels in nearly nine months. This drop was attributed to progress towards resolving a dispute in Libya, where negotiations facilitated by the United Nations led to an agreement among legislative bodies to appoint a new central bank governor within 30 days. The dispute had previously disrupted Libyan crude production and exports, with major ports ceasing exports and production being scaled back across the country. Prior to this development, market sentiment had already been bearish due to concerns about reduced demand stemming from sluggish economic growth in China, the world's largest importer of crude oil. Specifically, China reported a decline in new export orders for the first time in eight months in July, alongside slower price increases in the housing market in August.
Natural Gas
Natural Gas futures for October settled up $.076 or 3.573% at $2.203. Natural gas prices rose on Tuesday, amid indications of strong demand driven by increased use of air conditioning due to exceptionally high temperatures in the Midwest. Over the weekend, record-breaking heat affected more than 60 million people, prompting heightened activity in cooling systems. Simultaneously, investors monitored domestic gas supply levels amidst reduced liquefied natural gas (LNG) exports. The U.S. saw 26 LNG cargoes shipped in the week ending August 28th, with pipeline deliveries declining compared to the previous week, bolstering domestic availability. This coincided with a scheduled maintenance shutdown at Texas's Freeport LNG export facility.