Coquest Daily Energy Report

Crude Oil Futures for October 2022 settled up $3.38 @ $93.74/bbl. trading in a $3.80 range including the overnight-RBOB settled up 4.18/cpg and Heating Oil settled up 6.57/cpg. High-impact exploration is back after a dismal 2021-which saw one of the lowest success rates on record. Exploration and production companies are drilling more high impact wells this year, with a much higher success rate than during 2021. So far this year, E&P firms have discovered over 1.7 billion barrels of oil equivalent at high-impact wells, nearly quadruple the 450 million boe discovered for the whole of 2021, leading research showed this week. So far during 2022, the success rate at such wells has stood at 47.0%, much higher than the meager 28.0% success rate last year, Companies plan to drill 33 high-impact wells in 2022, the largest annual number since analysts started tracking the sector in 2015.

Natural Gas Futures for September 2022 settled down $0.487 @ $9.193/mmbtu trading in a 0.978 cent range including the overnight session. According to Energy Information Administration data, U.S. consumption of natural gas averages 85.2 bcf/d during calendar 2022, up +3.0% from 2021. Consumption in the electric power sector continues to increase as a result of limited switching from natural gas-fired generators to coal-fired generators for power generation, despite elevated natural gas prices. In addition, rising U.S. natural gas consumption reflects increased consumption in the residential and commercial sectors as a result of colder temperatures on average in 2022 than in 2021. The EIA currently forecast that natural gas consumption will average 83.8 bcf/d during calendar 2023, about 1.3 bcf/d or -2.0% lower than in 2022.

 

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Disclosure: The risk of loss in trading futures and/or options is substantial. Past performance is not indicative of future results. The information in this message derived from third-party sources is believed to be accurate and reliable; Coquest does not guarantee the accuracy or completeness of the information. Opinions expressed in this material are subject to change without notice. This report should not be interpreted as a request to engage in any transaction of futures, options, and/or OTC derivatives. The information contained in this material is not to be relied upon in substitution for the exercise of your independent judgment. Seek independent financial, tax, legal, and accounting advice from your own professional advisers, based upon your particular circumstances.

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