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Oil Holds Near Five-Month Lows; Gas Surges on Early Winter Chill

Oil holds near five-month lows after third straight weekly decline
- The WTI prompt-month contract slipped $0.45 to $57.09/Bbl Monday morning (7:45 AM CT) as traders assess early signs of easing U.S.–China trade tensions
- The next round of negotiations is scheduled for this week, with President Trump voicing optimism about reaching a potential agreement
- Israel said it had reinstated a ceasefire with Hamas in Gaza after weekend hostilities
  - The White House remains confident the truce will hold, though it acknowledges the process is likely to be turbulent
- President Trump also announced plans for a second meeting with Russian President Vladimir Putin to discuss ending the conflict, though earlier talks have yielded little progress
Global oil on water continues to climb (Bloomberg)
- Data from Vortexa show crude volumes at sea are still increasing as rising output and longer shipping routes between producers and consumers keep cargoes offshore for extended periods
- OPEC+ producers are boosting supply as they roll back voluntary cuts, while non-OPEC producers like Guyana have begun new offshore production and US output has reached record highs
- The increase in seaborne crude comes amid weakening demand growth and an IEA forecast of a widening surplus that could reach up to 4 MMBbl/d in early 2026

Regional Market Insights

Updated regularly with the most important market moves and outlooks.

Natural gas jumps 20c on early signs of winter weather
- The November contract is up about 20c, while the Winter ‘25/’26 seasonal strip is higher by 15c to $3.80/MMbtu, and the Summer ’26 strip is up 9c to $3.85/MMbtu (8:00 AM)
- While gas production has recovered from last week’s lows, it remains reduced compared to average rates seen over the past few months, around 105.9 Bcf/d this morning
- LNG feedgas remains strong, with inflows to export plants around 17.94 Bcf/d
Weather forecasts shifted significantly colder over the weekend, especially for the Midwest and Northeast regions
- Lower-48 population-weighted average temperatures are forecast to fall to 56.2 ºF over the next two weeks, from 63.6 ºF last week
- This is the first material jump in heating demand to be forecast for the upcoming winter season
- While this is materially colder than forecasts shown on Friday, total HDDs forecast for the next two weeks are projected to be near the ten-year average
- This boost in demand will likely not be enough to push Lower-48 gas storage into net withdrawals, but will reduce the size of storage builds into the beginning of November