Daily Energy Report

Crude Oil Futures for January 2021settled down $0.50 @ $45.76/bbl, trading in a $1.18 range including the overnight. RBOB settled down 1.27/cpg and Heating Oil settled down 0.38/cpg.

The 12th OPEC and non-OPEC Ministerial Meeting was held via videoconference on Thursday, December 3. The meeting emphasized that DoC participants and all major producers must remain fully committed to efforts aimed at balancing and stabilizing the market. It noted that renewed lockdowns due to more stringent COVID-19 containment measures continue to impact the global economy and oil demand recovery, with uncertainties over the winter months. In light of the current oil market fundamentals and the outlook for 2021, participants agreed to reconfirm the existing commitment under the DoC decision from April 12, 2020, then amended in June and September 2020, to gradually return 2 mil/bpd, given consideration to market conditions. Beginning in January 2021, DoC participating countries decided to voluntary adjust production by 0.5 mil/bpd, from 7.7 mil/bpd to 7.2 mil/bpd.

Natural Gas Futures for January 2021 settled down $0.169 @ $2.406/mmbtu, trading in a .102 cent range including the overnight session.

The EIA estimates that the U.S. exported 7.2 bcf/d of LNG in October, an increase of 2.3 bcf/d from September and the largest month-on-month increase since domestic LNG exports began. Higher global forward pricing for LNG indicates improving netbacks for buyers of U.S. LNG in European and Asian markets for the upcoming winter season. The increased prices come amid expectations of natural gas demand recovery in those markets and potential LNG supply reductions because of outages at several LNG export facilities in the Pacific Basin and Atlantic Basin. The EIA forecasts that U.S. LNG exports will be above pre-COVID levels in November 2020, averaging 8.5 bcf/d, and will average 8.4 bcf/d in 2021, a 31% increase from 2020.