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Energy Market Snapshot

Rob Cook, RobCookKC@gmail.com

Energy Market Snapshot

📉 Crude Oil: $70.65 (-0.64) – Prices declined due to continued tariff concerns and expectations of a global oil surplus.

📈 Ethanol: $1.8325 (+0.02) – A slight increase as production and demand remain stable.

📈 Natural Gas: $3.731 (+0.103) – Prices surged as a Polar Vortex moves into the Midwest, driving higher heating demand.

💡 Market Insight: Crude oil faced pressure from trade tensions, while natural gas rallied on colder weather forecasts. 📊🔥

Commentary

Crude oil prices fell to $70.65 (-$0.64) on Friday, pressured by continued tariff concerns and expectations of a global oil surplus. The market also reacted to potential progress in Russia-Ukraine peace talks, which could lead to reduced sanctions on Russian oil. 

However, crude found some support from a weaker U.S. dollar and the expectation of tighter U.S. sanctions on Iranian exports. 

Meanwhile, natural gas prices rallied to $3.731 (+$0.103) due to a Polar Vortex moving into the Midwest and stronger-than-expected inventory draws. Long-term bullish factors include resumed LNG export project approvals, which could increase U.S. natural gas demand.

Short Term Energy Outlook

📊 Energy Market Outlook (2023-2026)

• Brent crude oil prices are projected to decline from $82 in 2023 to $66 in 2026, reflecting weaker demand and increased production.
• Gasoline retail prices follow a similar trend, falling from $3.50 per gallon in 2023 to $3.10 by 2026, in line with lower crude oil prices.
• U.S. crude oil production continues to rise, reaching 13.7 million barrels per day in 2026, indicating sustained growth in domestic supply.
• Natural gas prices are forecasted to increase from $2.20 in 2024 to $4.20 by 2026, suggesting higher demand and potential supply constraints.

📌 Key Takeaway: The market is shifting towards lower oil prices but higher natural gas costs, which could impact energy costs and investment strategies.

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