Coquest Daily Energy Report

Crude Oil Futures for March 2022 settled down $0.74 @ $86.61/bbl trading in a $2.34 range including the overnight-RBOB settled down 0.19 cpg and Heating Oil settled up 5.05/cpg. The International Energy Agency said that observable global oil inventories decreased by more than -600 million barrels last year, however, based on its estimates of supply and demand that the decrease should have been closer to -400 million barrels. The -200 million barrel discrepancy means the oil market could be a lot tighter than previously thought. The gap could be a result of underreporting of demand or over reporting production, the IEA said. The “lost barrels” highlight the fact that the IEA focuses on measuring oil stocks in OECD member countries while stockpiles in developing economies are rarely reported.

Natural Gas Futures for February 2022 settled up $1.988 @ $6.265/mmbtu trading in a 3.116 cent range including the overnight session. As Russia’s tanks and troops continue to amass at Ukraine’s borders, Moscow has reduced the amount of natural gas flowing into Europe. It is however delivering enough to keep power plants and factories running and ensure that European homes have fuel, but not enough to prevent prices from soaring. The fuel has arrived for decades even through periods of crisis and tension and even the breakup of the Soviet Union, but now Russia is threatening to cut off the gas if it faces economic sanctions following an incursion into Ukraine, and the United States and its allies are scrambling to line up a substitute. A senior Biden administration official said Tuesday that the U.S. has held discussions with major natural gas producers in North Africa, the Mid-East and Asia. The president plans to host Qatari Emir Tamim bin Hamad al-Thani at the White House on Monday, where they will discuss channeling Qatari gas to Europe.


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