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First Look - WTI extends gains with US inventories and OPEC+ in focus; inflows to Corpus Christi LNG hit another record high

Oil extends gains as market eyes US inventories and OPEC+ decision
- The WTI prompt-month rose $0.71 to $66.16/Bbl Wednesday morning (7:45 AM CT)
- The American Petroleum Institute (API) reported a 1.4 MMBbl draw for last week at the Cushing oil storage hub.
  - If confirmed, the decline would be the biggest since January, and would bring stockpiles at the Cushing hub to their lowest seasonal level since 2005
  - The EIA is set to release government data Wednesday morning
- The OPEC+ meeting this Sunday is expected to deliver another large increase in production hikes
Floating storage builds in the Middle East are rising (Goldman Sachs)
- The two-week average for global stockpiles pf crude oil rose by 1.4 MMBbls over the last three months as floating storage in the Middle East rose, according to analysts at Goldman Sachs
- Iran accounts for a large portion of these increases due to last month’s conflict with Israel
  - As geopolitical risk continues to abate the oil is expected to be offloaded to onshore storage facilities or refineries
- The build in floating storage more than offsets draws in onshore stockpiles, including in the U.S.

Natural gas prices are trading higher, after falling 4c yesterday
- Lower-48 population weighted average temperatures are currently forecast to remain mostly near the ten-year average, resulting in a slight trend higher in gas demand
- Inflows to LNG export plants rose again, with Corpus Christi LNG hitting another record high today
Producers Midstream to expand Permian pipeline capacity
- Producers Midstream II LLC plans to use existing pipelines to transport natural gas from the Permian Basin to Midcontinent markets by the first quarter of 2026
- Developers launched an open season on the Palo Duro Pipeline, saying “The pipeline’s unique interconnectivity and strategic positioning creates a much-needed additional outlet for constrained Permian gas”
- The project will utilize existing infrastructure and expand takeaway capacity by about 80 MMcf/d

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