Crude

The Organization of the Petroleum Exporting Countries and its allies, aka OPEC-plus, on Saturday agreed to extend May and June oil supply cuts for another month to continue rebalancing an oversupplied global crude market.

Oil and gas companies around the world have announced plans to divest non-priority assets with recoverable reserves totaling some 12.5 billion boe since December 2019, according to new analysis by Rystad Energy.

The impact of Covid-19 on pressuring U.S. natural gas prices remains a wildcard, but supply/demand changes point for the strip to move lower this year before 2021 ushers in “extremely bullish” prices, Raymond James & Associates Inc. said Monday.

The notion of linking natural gas to crude oil is a funny one for the uninitiated in North America, where an abundance of supplies and a robust wholesale market reign. However, nearly three-quarters of all the world’s liquefied natural gas (LNG) trade is tied to oil prices.

Investment by U.S. oil and gas producers is likely to drop by at least 35% in the second quarter versus the first quarter of this year due to the crushing impact of Covid-19 on crude prices and a lack of available storage capacity, the Federal Reserve Bank of Dallas said Friday.

Natural gas futures snapped a three-day losing streak, edging up Monday as weather models hinted at what could be a warmer-than-normal summer. However, with a looming storage “tsunami,” the June Nymex gas futures contract settled only three-tenths of a cent higher than Friday’s close at $1.826. July climbed .008 cents to $2.085.

Enterprise Products Partners LP (EPD) has yet to see a “material change” to volumes across its system, but given the “highly uncertain” impacts of the coronavirus for the remainder of 2020, it has reduced planned growth capital investments by $1 billion and sustaining capital expenditures (capex) by $100 million.

Still struggling to get a grasp on how much demand is being lost amid the coronavirus pandemic, natural gas traders on Monday took their cue from unparalleled deterioration in the oil markets. After an initial sell-off early in the session, the May Nymex gas futures contract rallied, shattering resistance and settling the day at $1.924, up 17.1 cents from Friday’s close. June climbed 14.6 cents to $2.049.

Extraordinary measures are continuing to slam the oil and gas markets, as more North American producers, including EQT Corp. and EOG Resources Inc., are announcing cuts to spending while oil prices — and demand — are slaughtered.