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Natural Gas Poised for Third Weekly Gain; Petrobras Accelerates Deep-Water Output

Oil rises, trimming weekly losses
- The WTI prompt-month contract gained $0.42, reaching $59.85/Bbl Friday morning (7:45 AM CT)
- Supplies from both OPEC+ members and non-OPEC producers are poised to surge heading into 2026
- While increased oil volumes are appearing on tankers, major storage hubs have yet to feel the full impact
  - Despite a 5 MMBbl build in US inventories, October ended lower than it began
- “The market continues to weigh a rising oil surplus against mixed macro signals,” said Ole Hvalbye of SEB AB
- In Asia, China reported October imports rose year-over-year, though Bloomberg analysis suggests the pace of stockpiling will slow
- The spread between the nearest WTI futures closed Thursday at its weakest level since February
Petrobras to boost output, adding to global oversupply (Bloomberg)
- Brazil’s state oil company Petrobras is accelerating production from the world’s largest deep-water field, aiming to lift dividends even as crude prices hover near five-year lows and the market braces for a glut
- Output from the Buzios field off Rio de Janeiro hit 1 MMBbl/d last month after the sixth floating production unit reached capacity three months ahead of schedule

Regional Market Insights

Updated regularly with the most important market moves and outlooks.

Natural gas heads for a third weekly gain ahead of cold front
- Prompt Henry Hub prices extended gains this week, with prices up about 17c this week and 30c over the past two weeks (8:10 AM)
- Yesterday, the EIA reported a storage build of 33 Bcf, putting inventories 162 Bcf above the five-year average
- LNG feedgas averaged a very high rate this week of 18.39 Bcf/d
  - While not included in US LNG feedgas demand, LNG Canada has begun production from Train 2, lifting inflows to about 1 Bcf/d
Early winter cold front to lift demand and spot prices (S&P)
- This weekend and into the first part of next week a cold front should impact much of the Lower-48, and especially the Midwest and Northeast regions
- Temperatures should be well-below average for several days, lifting demand for space heating
- The increased demand will likely result in higher cash prices at key regional hubs
- Following the cold snap, temperatures are forecast to warm up and remain above the ten-year average for the remainder of the two-week forecast period