Daily Energy Report

Crude oil futures for August 2021 settled up $0.07 @ $72.98/bbl, trading in a $1.84 range including the overnight. RBOB settled up 2.24/cpg and heating oil settled up 0.37/cpg.

With the next meeting at hand, OPEC and their working allies continue to discuss a further easing of oil output cuts from August as oil prices rise on demand recovery, but no decision had been taken yet on the exact volume to bring back to the market. “It is highly possible to increase gradually from August,” said one of the sources, adding that no final decision had been made and the exact volumes are yet to be agreed on. The talks mean that OPEC and Russia are likely to find common ground again on oil production policy. Moscow has been insisting on raising output further to avoid prices spiking, while key OPEC producers, such as Saudi Arabia, have given no signals on the next step until now.

Natural Gas Futures for August 2021 settled up $0.037 @ $3.630/mmbtu, trading in a .240 cent range, including the overnight session.

The Energy Information Administration currently estimates that natural gas inventories ended May 2021 at almost 2.4 trillion cubic feet, which is -3.0% lower than the five-year (2016–20) average. More natural gas was withdrawn from storage during the winter of 2020–21 than the previous five-year average, largely as a result of the colder than average February temperatures that contributed to a drop in natural gas production. The EIA currently forecasts that inventories will end the 2021 injection season at 3.6 trillion cubic feet, which would be -4.0% below the five-year average. The EIA data showed dry natural gas production will average 92.9 bcf/d in 2H-21 and then rise to 93.9 bcf/d in calendar 2022.

 

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