U.S. Crude Oil Could Be Ripe for A Short Squeeze

Crude oil inventories at Cushing have dropped to their lowest level for this time of year in over a decade.
The depleting stocks at Cushing and the bearish sentiment on the oil market, especially the recent more negative positioning in WTI Crude, could lead to high prices in the near term.
In the three weeks to January 19, inventories at Cushing fell by more than 5 million barrels.

Azerbaijani Gas is Bridging the Supply Gap in Europe

Azerbaijan plans to increase its gas exports from 8 billion cubic meters in 2021 to 20 billion cubic meters by 2027.
This expansion requires increased gas production and capacity enhancement of the Southern Gas Corridor pipelines.
Challenges include securing purchase agreements with European buyers and competing with flexible LNG exports.

Soaring U.S. Crude Production Fuels Export Boom

U.S. oil production reached a record 13.2 million barrels per day, significantly increasing exports, especially to Europe and Asia.
End-of-year tax considerations are prompting traders to export more oil to reduce taxable inventory, with exports expected to average 5 million barrels per day.
The integration of WTI Midland in the Brent basket and the European embargo on Russian oil have contributed to the growing popularity of U.S. crude in global markets.

Record-High U.S. Production Weighs on Natural Gas Prices

Record temperatures in Europe and North America extended the gas storage refill season, leading to high inventories.
Natural gas demand decreased due to warmer weather, an industrial slowdown in Europe, and record U.S. production and LNG exports.
Futures and options market winter premiums have diminished, contributing to a drop in Europe’s natural gas prices and bearish trends in the U.S. and Asian markets.