Realizing the recession risk, storage is filling and demand expectations downgraded
Calgary, Alberta (October 4, 2022) — Enverus Intelligence Research (EIR), a subsidiary of Enverus, the most trusted energy-dedicated SaaS platform, has released its latest Macro Forecaster, a report that looks at near-term oil and gas balances, recession risks, the impacts of the Russia-Ukraine war and the effects of COVID-19 lockdowns on Chinese oil demand.
“OPEC’s decision to roll back its tiny September supply increase in October indicates it is back in price defense mode as demand expectations are downgraded,” said Bill Farren-Price, report author and a director at EIR.
Looking at the European gas market, the report noted that European total gas storage has surpassed its 80% November fill target. Enverus forecasts it could be more than 90% by November.
Key takeaways the report:
Total U.S. annual demand averaged 19.6 MMbbl/d for the past four weeks ended Sept. 16, off 7% from the same period in pre-pandemic 2019. Similarly, Chinese demand declined Q/Q for the first time in history primarily due to continued COVID-19 challenges. Slow demand recovery supports Enverus’ view that global oil demand will remain below pre-pandemic levels until 2023.In gas markets, if EU countries are successful in maintaining the targeted 15% demand reduction from August to March, Enverus predicts winter stock levels will be sufficient to keep gas flowing through the winter with average temperatures.U.S. natural gas storage inventories are 332 Bcf below the five-year average. Enverus expects injections to outpace the five-year rate to close this deficit to ~150 Bcf by the end of summer.
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About Enverus Intelligence ResearchEnverus Intelligence Research, Inc. is a subsidiary of Enverus and publishes energy-sector research that focuses on the oil and natural gas industries and broader energy topics including publicly traded and privately held oil, gas, midstream and other energy industry companies, basin studies (including characteristics, activity, infrastructure, etc.), commodity pricing forecasts, global macroeconomics and geopolitical matters. Enverus Intelligence Research, Inc. is registered with the U.S. Securities and Exchange Commission as an investment adviser.
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