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First Look - Natural gas rises ahead of EIA storage report

Oil rises on UK trade agreement
- Crude prices climbed as President Trump is expected to announce a trade deal with the UK, potentially setting the tone for broader trade policy
- WTI prompt-month contract increased $1.15 to $59.22/Bbl early Thursday morning (7:30 AM CT)
- The announcement precedes upcoming trade negotiations between the US and China
- EIA data showed crude inventories declined for a second consecutive week, reaching the lowest level since late March
Kazakhstan says no May output cuts planned (Bloomberg)
- Kazakhstan is projected to produce around 2 MMBbl/d of oil, per Bloomberg estimates
- Despite OPEC+ targets calling for just under 1.4 MMBbl/d of crude in May, Kazakhstan plans to maintain April’s higher production level
  - Condensate output expected at approximately 260 MBbl/d

Natural gas prices are slightly higher ahead of EIA inventory report
- The EIA is expected to report an injection of 101 Bcf, according to the Bloomberg survey
  - Last week's report saw inventories climb above the five-year average for the first time since February
- LNG feedgas levels have moved higher to 15.2 Bcf/d, after falling below 13 Bcf/d earlier this week on a Freeport outage
  - Cameron LNG inflows remain lower due to maintenance
Williams to build new Transco expansion (S&P)
- Williams will build a 950 MMcf/d expansion of the Transcontinental pipeline in Virginia to meet growing demand for natural gas power generation
- The expansion, called Power Express, will source gas primarily from Transco Station 165 and north, with it not being dependent on the Mountain Valley Pipeline expansion
- The brownfield expansion is “backed by a significant commitment from an anchor shipper and will utilize existing right-of-ways and infrastructure to reduce permitting risk.”
- Production growth in the Northeast is often constrained by limited pipeline space; Projects like this one should alleviate these issues and result in tighter basis pricing until the pipes fill again