Oil pares losses as markets await US-Iran memorandum signing
The WTI prompt-month contract rose $0.65 to $76.70/Bbl on Wednesday morning (7:30 AM CT)
An interim agreement between the US and Iran is expected to be signed on Friday, paving the way for financial relief measures that would allow Iran to resume oil exports with reduced sanctions restrictions
The US Treasury Department is expected to grant waivers covering Iranian crude oil, petrochemical products, and related exports once the memorandum takes effect
Despite progress toward a deal, President Trump warned that the US could launch additional military action if Iran fails to meet its commitments, helping to preserve some geopolitical risk premium in crude markets
The IEA said the conflict's impact on oil demand could be more severe than previously expected, forecasting global oil consumption to decline by 1.1 MMBbl/d in 2026 versus its prior outlook for a roughly 420 MBbl/d contraction
The API reported that US crude oil inventories fell by 8.3 MMBbls last week, with official EIA data scheduled for release later Wednesday
The Cal 2027 WTI strip has fallen toward $70/Bbl following the recent selloff as traders increasingly price in the likelihood of a US-Iran agreement being finalized this week
Gas edges lower on mixed forecast changes
Natural gas is down -4.1c to $3.198/MMBtu (As of 07:30 AM CDT)
Final noms gained back over 1.2 Bcf of L48 production yesterday, so the actual production slip was closer to 0.7 Bcf yesterday (Criterion)
Production, however, slipped in early noms again today by 0.8 Bcf
L48 Demand is up 1.8 Bcf day over day which can be attributed to a 2.7 gain in power demand (Criterion)
L48 weather forecast changes were mixed today (CWG)
There was little change in the forecast in the first 9 days, however day 10-15 saw some significant, albeit mixed, developments
Overall, the Midwest lead cooling in this range, losing over 12°F
LNG feedgas demand hits highest level since April
Golden Pass LNG had 425 MMcf/d of feedgas demand yesterday and is nominating for 480 MMcf/d this morning
Golden Pass exported its second cargo on May 9
The LNG facility appeared to not load a cargo on a tanker that arrived on June 8 (S&P)
Total L48 LNG feedgas noms are 19.5 Bcf this morning
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