Coquest Daily Energy Report

Crude Oil Futures for December 2022 settled up $1.05 @ $86.92/bbl. trading in a $4.62 range including the overnight-RBOB settled down 1.24/cpg and Heating Oil settled up 9.73/cpg. Russia has made a decision to allow Japanese firms to keep their stake in the Sakhalin-1 oil project in Russia’s Far East as Moscow reshuffles ownership of domestic oil and gas projects after a mass exodus of Western firms following the Russian invasion of Ukraine. “The decision is very significant for stable energy supplies to our country over the medium to long term,” Japan’s Chief Cabinet Secretary Hirokazu Matsuno said on Tuesday. Early this month, the Japanese government asked companies that participated in the original consortium to retain their stakes in the new entity that will operate the project. President Putin signed a decree to change the ownership of Sakhalin-1 last month, with the state setting up a new entity to manage the project. Previous shareholders such as Japan’s SODECO consortium were offered the chance to retain their stakes.

Natural Gas Futures for December 2022 settled up $0.101 @ $6.034/mmbtu trading in a 0.362 cent range including the overnight session. The Freeport LNG facility could remain out of commission until the end of the year as work on the repairs after the blast that shut it down in June continue. Freeport LNG told buyers it will likely cancel shipments scheduled for November and December as the work continues. While global LNG prices are currently sliding amid a temporary glut ahead of the northern hemispheres winter, an extended outage could over tighten the market again and complicate Europe’s effort to replace Russian gas. According to market advisors, the longer the export plant remains offline, the more gas will be accumulated at home, weighing on domestic prices.


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