Your Daily Energy Report for October 22, 2024
Posted on 2024-10-22
Crude Oil
Crude Oil futures for November settled up $1.53 or 2.168% at $72.09. Oil prices rose on Tuesday, marking a second consecutive day of gains. Traders have shifted their focus from the potential for a ceasefire in the Middle East to the tightening balance between global supply and demand. Despite US Secretary of State Antony Blinken's efforts to facilitate discussions with Israeli Prime Minister Benjamin Netanyahu, doubts about an imminent ceasefire linger due to Israel's ongoing military actions and Hezbollah's unwillingness to engage in talks. Additionally, China's recent economic stimulus, which includes reduced benchmark lending rates, has provided some support for oil prices. However, concerns about China's long-term oil demand remain, as expectations of slower economic growth and a transition to electric vehicles may limit future consumption. Crude inventories at the Cushing, Oklahoma hub have risen for four weeks straight, the longest streak of inflows since March.
Natural Gas
Natural Gas futures for November settled down -$.001 or -.043% at $2.311. Natural gas prices showed little movement on Tuesday, reversing earlier gains following a strong rebound on Monday. Additionally, the volume of gas flowing to liquefied natural gas (LNG) export facilities has decreased this week. Although mild temperatures are expected in the short term, a drop is predicted for November, which could increase heating demand compared to October levels. On the supply front, analysts believe that producers may cut back on output in 2024, marking the first reduction since 2020, as drilling activities slow down. Evergy announced plans to construct two 705-megawatt high-efficiency natural gas plants in Kansas, which are intended to address the region's increasing electricity demands and potentially lower utility costs over time.