Coquest Daily Energy Report

Crude Oil Futures for December 2021 settled down $0.80 @ $80.79/bbl trading in a $1.84 range including the overnight-RBOB settled down 0.64/cpg and Heating Oil settled down 4.34/cpg. The Energy Information Administration currently forecasts that Brent prices will remain near current levels for the remainder of 2021, averaging $81.00 per barrel during the fourth quarter of 2021, which is $10.00/bbl. higher than our previous forecast. The higher forecast reflects the EIA’s expectation that global oil inventories will fall at a faster rate than had previously been expected, owing largely to lower global oil supply in late 2021 across a range of producers. For calendar 2022, expectations are that growth in production from OPEC+, domestic tight oil, and other non-OPEC countries will outpace slowing growth in global oil consumption and contribute to Brent prices declining from current levels to an annual average of $72.00/bbl.

 

Natural Gas Futures for December 2021 settled down $0.358 @ $4.791/mmbtu trading in a .389 cent range including the overnight session. According to Energy Information Administration data, estimates are that U.S. natural gas inventories ended September 2021 at about 3.3 trillion cubic feet, -5.0% less than the five-year average for this time of year. Injections into storage this summer have been below the previous five-year average, largely as a result of electricity consumption in June due to hot weather and increased exports, even as domestic natural gas production has remained flat. The EIA currently forecasts that inventories will end the 2021 injection season at almost 3.6 tcf, which would also be -5.0% less than the previous five-year average. Expectations are that natural gas inventories are to decrease by -2.1 tcf this winter, ending March at less than 1.5 tcf, which would be -12.0% less than the 2017–21 average for that time of year.

 

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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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