The WTI prompt-month contract surged $9.82 to $100.72/Bbl on Monday morning (7:30 AM CT)
Crude pushed past $100/Bbl as escalating disruptions across the Middle East forced several major producers to curtail output tanker traffic through the critical Strait of Hormuz remains largely halted
Last week, Iraq announced a reduction of roughly 1.5 MMbbl/d of production, warning the cuts could deepen toward 3.0 MMbbl/d if shipping through the waterway does not resume soon
Kuwait and the UAE also began scaling back output over the weekend as storage facilities fill rapidly amid the export bottleneck created by the closure
According to JPMorgan, Middle East production shut-ins could exceed 4 MMbbl/d by the end of next week as storage constraints intensify and logistical bottlenecks persist across the region
Any disruption to Kharg Island, which handles roughly 90% of Iran’s crude exports, could remove an additional 1.0–1.5 MMbbl/d from global supply, potentially lifting total losses to at least 5 MMbbl/d and above 8 MMbbl/d when refined products are included
Prices later pulled back from intraday levels near $120/Bbl after reports that G7 finance ministers may discuss a coordinated release of strategic oil reserves during meetings later Monday
The conflict shows little sign of de-escalation, with Iran reportedly naming the son of the late Ayatollah Ali Khamenei as the country’s new supreme leader, signaling continued support for the current government and its wartime strategy
Natural gas prompt month is up 13.8c to $3.324/MMBtu (As of 07:30 AM CT)
Weather forecasts shifted over the weekend in a mixed pattern (Criterion)
There were gains all throughout the forecast period in the Rockies and West regions, while there was offsetting moderate losses east of the Rockies in the 6-10 day range
Weather is currently firmly above the 10-year average, but is expected to roughly fall back in line with it later this week through the end of the 2-week forecast period
Total supply fell close to 2 Bcf/d this morning, as losses occurred in production and CAD imports to the northeast and Midwest regions decreased (S&P)
LNG feedgas demand fell -252 MMcf/d to 19.5 Bcf/d as an unplanned outage at Freeport lasted 9 hours on Sunday
This marks the second week in a row where an unplanned outage in the gulf fleet has caused LNG feedgas to operate under full capacity for a time period
Normalization is expected tomorrow (Criterion)
Golden Pass began restarting commissioning flows this weekend, reaching 253 MMcf/d this morning
Get market insights delivered to your Inbox every day!
