Filtered by Subscriptions: Energy Use setting Energy
One left-field option for alleviating Europe’s gas crisis that has been doing the rounds is the potential for asking Norway to discount the price of its gas exports. This Update looks at eight key questions on the topic. In short, an agreement would …
24th August 2022
We have revised up our forecasts of the European natural gas price due to the scale of Russia’s supply cuts and the likelihood that these are permanent. Prices should ease back in 2023 as Europe imports more LNG and demand falls, but we think they will …
Signs of stronger demand failing to lift prices The large fall in US commercial crude stocks was mostly due to a renewed rise in exports. Implied gasoline demand rose for a second consecutive week, but this failed to lift prices amid growing concerns over …
17th August 2022
More of the same OPEC’s monthly report for August showed that the group continues to produce significantly less than its quota and we expect this trend to continue in the coming months. OPEC is clearly worried about demand due to the economic slowdown, …
11th August 2022
Lower prices are boosting gasoline demand The rise in US crude stocks was in large part down to a drop in exports. More interesting was the jump in implied gasoline consumption, which probably reflects the recent fall in prices. This may not be …
10th August 2022
With Russia tightening its squeeze on supply of gas to Europe, governments are turning their attention to other major gas exporters such as Qatar to try to fill the gap. But Qatar’s gas sector is already operating close to capacity and, while the North …
9th August 2022
Concerns about the demand outlook have dragged the Brent crude oil price towards $90 per barrel this week. But, the supply-side concerns which pushed the price over $120 per barrel not too long ago haven’t entirely vanished. Indeed, following the OPEC+ …
5th August 2022
Commercial stocks rise, but scope for further increases is limited Crude oil prices have been for a rollercoaster ride today, rising by $3 per barrel following the OPEC+ meeting, and then more than erasing those gains later on. Prices fell particularly …
3rd August 2022
Overview – While non-energy commodities prices may fall a little further, we think the big move down in those prices is now behind us. Admittedly, the demand outlook has undeniably deteriorated in recent months, but many of the supply risks that prompted …
28th July 2022
Rising exports are becoming increasingly controversial There were large increases in both crude and product exports in the latest data, which will add fuel to lobbyists’ calls for restrictions on exports while prices are high . The EIA’s weekly US …
27th July 2022
The news today that Gazprom will further reduce its natural gas supply to Europe increases the likelihood of recessions in the euro-zone, UK and parts of Emerging Europe. It also supports our view that inflation pressures will be relatively persistent in …
26th July 2022
US commercial crude oil stocks looking fragile US commercial stocks fell last week, largely on the back of a rise in exports and a drop in imports. The fall came despite another bumper release from the strategic reserve. As those government stock …
20th July 2022
Europe’s heightened demand for LNG will be enough to keep prices high this year and into 2023, particularly as LNG supply growth will be fairly limited . The Asia-based spot price for LNG, together with its European counterpart (TTF), soared in the wake …
18th July 2022
Clear signs that high prices are weighing on demand Total crude stocks fell again, mainly due to ongoing sales from the strategic reserve. That said, the big news was hefty builds in petroleum product stocks, suggesting that high prices are finally …
13th July 2022
OPEC looking more likely to scrap quotas from September OPEC unveiled its oil market forecasts for 2023 in its monthly report today. OPEC is more bullish than us on demand, forecasting an increase of 2.7m barrels per day. But even though it is also quite …
12th July 2022
After a period of extreme volatility, we expect the price of US natural gas to edge higher in the remainder of this year. Together, a rise in LNG exports and a pick-up in US consumption this winter will keep stocks low by past standards and underpin a …
11th July 2022
US petroleum product demand to be seasonably soft US commercial crude stocks rose owing to a fall in net exports and lower inputs to refineries. For now, implied product demand remains in line with its seasonal norm, but we expect demand to be soft for …
7th July 2022
Overview – Non-energy commodities prices generally fell in June on the back of concerns about the outlook for demand amid global monetary tightening and slower economic growth. Energy prices may also fall a little from here, but constrained supply will …
6th July 2022
Refinery constraints to put a floor under commercial crude oil stocks Commercial crude stocks fell last week as refineries raised production of petroleum products. However, refineries will probably struggle to raise output much further, with many of them …
29th June 2022
The G7 proposal to impose a cap on the price of Russian oil and gas would introduce new supply-side risks by potentially disrupting Russian energy supplies. This could push global energy prices up further, but for now we still see Brent crude prices …
28th June 2022
Whilst OPEC+ has been failing to meet its production quotas in recent months, it will technically finish unwinding its pandemic-related supply cuts come September. We think OPEC+ will then move to a more liberal approach and allow the few members with …
23rd June 2022
Russia’s decision to once again cut supplies to Europe makes the region’s gas supply look increasingly precarious. The move will slow regional stock builds and keep prices historically high . Russia’s monopoly gas exporter, Gazprom, announced on Wednesday …
16th June 2022
High prices keeping a lid on demand Commercial crude stocks rose again this week, following another unusually large release from the strategic reserve. Meanwhile, implied product demand fell back as petroleum product prices remain very high. We’re …
15th June 2022
The closure of the Freeport LNG facility in the US, for up to six months, adds to concerns about Europe’s ability to fill its gas storage tanks ahead of winter. We always suspected that supply concerns would re-emerge this year and, as a result, we …
OPEC still seems optimistic on Russia’s output this year The gap between OPEC-10’s quota and output widened further in May, which adds weight to our view that the group will fail to fully unwind its production cuts by year-end. What’s more, whilst OPEC …
14th June 2022
Demand holding up, for now Commercial crude oil stocks rose this week owing to an unusually large release from the strategic reserve and a slump in crude exports. Interestingly, implied product demand ticked up, after being relatively subdued for a few …
8th June 2022
Overview – Energy and agricultural prices continued to rise in May as concerns about supply more than offset signs that demand, at least for energy, could soften. We expect prices to remain historically high but to start to ease back later in the year as …
7th June 2022
Global refinery capacity is stretched with less of Russia’s capacity at work Slack should return if Russia re-routes some of its petroleum product exports But unplanned refinery outages will now remain a bigger risk to crude oil demand In this Energy …
31st May 2022
The EU’s sixth round of sanctions on Russia marks yet another defining moment in the West’s detachment from Russia’s energy trade. The sanctions were widely telegraphed in advance, though, so for now we still forecast that crude oil prices will remain …
Commercial stocks to continue to lean on strategic reserves for support Commercial crude oil stocks fell again last week, but at a slower pace. Once again, lower net imports and higher refinery inputs led to the drawdown. Although both drivers became more …
25th May 2022
High product prices to suppress demand this summer Commercial crude oil stocks fell last week due to exports rising faster than imports and refineries stepping up operations. But high petroleum product prices should hold back demand in the coming months, …
18th May 2022
OPEC production still falling short of target OPEC lowered its forecast for Russia’s oil production this year, but still expects it to rise. By contrast, we think Russia’s output will fall and see rising pressure on OPEC to step up output in response . …
13th May 2022
We expect US fuel prices to remain historically high this year due to supply constraints. As a result, we suspect that oil consumption in the US will remain seasonably low for much of the rest of the year. US implied product demand has fallen from a …
12th May 2022
Unless prices fall, US demand is likely to remain soft Commercial crude stocks will be boosted in the coming weeks by the ongoing release of strategic reserves, regardless of what is happening with domestic oil demand. That said, there are now clear signs …
11th May 2022
News of force majeure on one of the pipelines in Ukraine bringing Russian natural gas to Europe just adds to our conviction that Europe is going to struggle to meet its gas needs over the next year. The heightened competition for gas imports suggests that …
High petroleum product prices to constrain US oil demand Commercial crude oil stocks rose last week on higher imports, lower exports and less crude oil being used by refineries. Implied product demand, meanwhile, was little changed and towards the lower …
4th May 2022
The EU proposal to end imports of Russian crude oil and petroleum products by the end of the year has long been in the works. If approved, we expect Russia’s oil exports to fall by around 20% this year, which in turn would keep oil prices over $100 per …
Overview – The war in Ukraine and its negative impact on commodities supply has prompted us to revise up our forecasts for the prices of most commodities in 2022. Regardless of the outcome of the war, we think energy prices will remain historically high …
29th April 2022
Russia’s decision to suspend gas deliveries to Poland and Bulgaria from today because of a payments dispute will only strengthen the EU’s resolve to end its dependency on Russian gas, keeping gas prices historically high for months to come. The move also …
27th April 2022
US commercial crude oil stocks look set to recover this year Commercial crude oil stocks fell last week on the back of a rise in exports and a decrease in imports. Going forward, though, the US government’s plan to further draw down its strategic oil …
20th April 2022
Strong demand for LNG exports should lead to a higher average price of US natural gas this year. But we expect prices to ease back in the coming months as demand falls over the summer and output stays high . The price of US natural gas (Henry Hub) has …
14th April 2022
SPR releases to boost commercial stocks significantly in months ahead Crude stocks in commercial storage shot up last week, as the US government made more sales from its strategic reserve and refineries curbed output in the wake of weaker demand. With …
13th April 2022
OPEC still dragging its heels OPEC oil production rose a little in March, but the group continues to underproduce. What’s more, its optimistic non-OPEC supply forecasts suggest that it has no intention of boosting output in the near term . The OPEC …
12th April 2022
US commercial oil stocks unexpectedly rise, dragging prices down Commercial crude stocks rose last week, beating market expectations of a decline, due to rising domestic production and another sale from the Strategic Petroleum Reserve. If sustained, …
6th April 2022
Commodity prices are as volatile as they’ve ever been. We don’t think volatility will ease until the war in Ukraine ends, because only then will we know the true extent of the Russia-related supply shock . Commodity prices are naturally volatile for many …
31st March 2022
High prices hitting demand; don’t rule out shale sector just yet Crude stocks fell again last week, as healthy profit margins appear to be driving an upturn in refinery activity. That said, high product prices are also taking their toll on consumer …
30th March 2022
The experience of the 1970s suggests that the ongoing war in Ukraine and its effects on commodity prices will reshape commodity markets for years to come. Most immediately, elevated prices are likely to lead to some degree of demand destruction. And …
29th March 2022
Record high fuel prices to constrain US oil demand US commercial crude oil stocks fell last week, driven by a decrease in net imports and greater refinery inputs. Demand also inched higher, but we suspect high prices will limit further gains . In its …
23rd March 2022
We expect Russia’s coal and gas exports to fall this year, keeping prices high But Russia’s energy exports could fall by much more under a Western embargo In this extreme scenario, there would be limited supply elsewhere to compensate In this Energy Watch …
High prices likely to put a floor under crude stocks US commercial crude stocks rose last week but remained historically low for the time of the year. Demand took a tumble and will probably struggle to rise much further with gasoline prices so high. In …
16th March 2022