Best in Energy – 4 April 2023

OPEC⁺ output cut aims to deter short selling ($BBG)

OPEC⁺  v. central banks in fight over inflation ($BBG)

OPEC⁺  production cut – why now?

OPEC⁺ output cut – why now? ($FT)

U.S. gas production is still increasing

California’s snowpack highest since 1983 ($WSJ)

California’s in-state hydro generation set to rise

U.S. energy consumption projection through 2050

China deploys almost continuous at-sea deterrent

Travel-to-work and the 30 minute average commute

BRENT calendar spreads had already tightened significantly between March 20 and March 31, then tightened further after Saudi Arabia and its allies in OPEC⁺ announced production cuts on April 2. The six-month spread tightened from a backwardation of $1.13 (59th percentile since 1990) on March 20 to $1.46 (64th percentile) on March 31 and then $3.43 (88th percentile) on April 3. The spreads imply traders were not anticipating a significant oversupply or a large increase in inventories prior to the OPEC⁺ cut. Following the cut, however, traders expect the market to become very tight later in 2023:

Published by

John Kemp

Energy analyst, public policy specialist, amateur historian