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First Look - NextDecade warns of risks to LNG project approvals

Oil is trading lower, extending losses from last week
- Economic data from China continues to show signs of weakness, potentially leading to weaker crude demand
- RBC recently said in a note that, “In the medium term, slowing economic activity, weakness in Asia, and softer refinery margins all don’t bode well for crude prices going into year-end,”
Ceasefire talks stall despite US efforts (BBG)
- Israel and Hamas blamed each other for stalling ceasefire efforts over the weekend, as US Secretary of State Antony Blinken arrived in the region
- Hamas claimed responsibility for a bombing in Tel Aviv on Sunday, hindering attempts at de-escalating the conflict
- Iran continues to say it will attack Israel in the coming days, saying that while it welcomes cease-fire negotiations, they are not directly related to Iran’s right to respond to Israel
- The conflict has led to higher geopolitical risk premium in crude prices

Natural gas is trading higher amid weaker production levels
- Gas output fell over the weekend, bringing volumes to 99.67 Bcf/d
- Weather forecasts cooled over the weekend, with temperatures for the next week expected to be below the ten-year average before rising to near-normal levels
NextDecade warns of risks to LNG project approvals (S&P)
- After the US Court of Appeals struck down critical approvals for Rio Grande LNG and Texas LNG, NextDecade said this could endanger other planned facilities' in-service dates
- NextDecade’s CEO said, “If the ruling stands, the precedent that the court’s action would set has the potential to impact the viability of all federally permitted infrastructure projects because it will be difficult for these projects to attract capital investments until they receive final unappealable permits,”
- Permitting or construction delays could impact the timing of incoming gas demand and pose a bearish risk to forward prices