Daily Energy Report
Crude Oil futures for April 2021 settled down $0.59 @ $64.80/bbl, trading in a $1.63 range including the overnight. RBOB settled down 0.34/cpg and heating oil settled down 1.62/cpg.
Domestic crude oil production averaged 11.3 million barrels per day in 2020, down -935,000/bpd or -8.0% from the record annual average high of 12.2 mil/bpd during calendar 2019. The 2020 decrease in production was the largest annual decline in the Energy Information Administration’s records. In January 2020, U.S. crude oil production reached a peak of 12.8 mil/bpd. By March 2020, crude oil prices decreased because of the sudden drop in petroleum demand that resulted from the global response to the COVID19 pandemic. The declining prices led crude oil operators to shut in wells and limit the number of wells brought online. In May, domestic crude oil production reached its lowest average monthly volume for the year at 10.0 mil/bpd.
Natural Gas Futures for April 2021 settled up $0.078 @ $2.562/mmbtu, trading in a .087 cent range including the overnight session.
According to data in the Energy Information Administration’s Short Term Energy Outlook for March 2021, the EIA currently expects Henry Hub spot prices to decline to an average of $2.880/mmbtu in the second quarter of 2021. The EIA expects that Henry Hub spot prices will average $3.140/mmbtu in 2021, which is up from the 2020 average of $2.030/mmbtu. The EIA also expects that continued growth in liquefied natural gas exports, along with relatively flat production, will contribute to Henry Hub spot prices rising to an average of $3.160/mmbtu in calendar 2022.
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