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First Look - Natural gas recovers following six consecutive losses

Oil prices volatile as US–Iran nuclear deal stalls
- Supreme Leader Ali Khamenei voiced doubts over renewed negotiations with the US, dampening hopes for a nuclear agreement
- Easing sanctions on Iran, or Russia, could add barrels to an already oversupplied market
- Traders remain divided, some anticipate downward pressure from rising supply risks, while others point to bullish signals like widening refining margins
Refiners turn profitable as crude prices fall
- Refining margins have rebounded, with European refiners earning nearly $7/Bbl and Asian margins also elevated
- The margin surge is driven by plant outages in the Atlantic Basin, stronger product demand due to lower crude prices, and a surprising spike in high-sulfur fuel oil strength
- Gains may be short-lived as seasonal maintenance ends and product supply ramps up, potentially squeezing profits
US shale expansion unlikely if crude nears $50
- ConocoPhillips CEO Ryan Lance warned that shale output is unlikely to grow if oil prices dip toward $50/Bbl
- Prices in the $60s would keep production flat, while levels closer to $70 could reignite growth
- The message underscores the fragile economics of US shale amid softening price signals

Natural gas prices recover, following six consecutive daily losses
- The June Henry Hub contract is up more than 10c this morning, reversing most of yesterday’s losses (8:00 AM)
- Despite the price recovery, demand continues to look limited over the next two weeks, bolstering anticipated storage injections
NY offshore wind project to resume on apparent gas pipeline compromise (BBG)
- Empire Wind 1, located off the coast of New York, was halted by the Trump administration a few weeks ago, but construction has been allowed to resume
- Interior Secretary Doug Burgum said he was encouraged by NY governor Hochul’s “willingness to move forward on critical pipeline capacity”
- The administration has been looking to support the development of additional pipelines in the Northeast US, but further details were not provided
Qatar LNG expansion to begin shipping cargoes by mid-2026 (BBG)
- Qatar said exports from it’s first LNG expansion project should start by the middle of next year
- The expansion will raise Qatar’s export capacity from 10.3 Bcf/d to 14.7 Bcf/d
- The timing of this startup will be closely watched by global gas market participants, as global LNG supply should increase sharply in 2026
  - The increase in LNG production should help keep European and Asian importers well supplied, although global gas markets are expected to remain relatively tight in 2026