Written Commentary
UNICA Report Approaches
August 14, 2025
CRUDE OIL
September Crude Oil is higher this morning as the market awaits President Trump’s announcement on Russia. There is some speculation that this will include another layer of sanctions on Russian oil exports. It could also include enabling arms shipments to Ukraine. Trump said yesterday that he will send Patriot air defense missiles to Ukraine. A bipartisan that would hit Russia with sanctions bill gained momentum in Congress last week, and European Union envoys are reportedly close to agreeing on an 18th package themselves. China’s oil imports reached 12.14 million barrels per day in June, up 7.4% from a year ago and their highest since August in 2023, according to customs data. However, JP Morgan said in a report that China is likely stock-building, that storage has reached 95% of the peak inventory build from 2020, and that net new these inventories are likely to emerge in “visible” Western market locations that could put pressure on prices. The Baker Hughes rig count showed US oil rigs in operation were down 1 rig last week to 424, down from 478 a year ago and below the five-year average of 435.
NATURAL GAS
The 6-10 and 8-14 day forecasts have turned warmer than they were on Friday, with the below normal temps retreating to Minnesota and upper Wisconsin in the 6-10 day and above normal expanding to the point where it covers most of the lower 48 in the 8-14 day, with the exception of the North Dakota, Minnesota, Wisconsin and Michigan. The may not be a heat dome, but it does allow for increased in cooling demand from what we were seeing late last week. Last week, LSEG forecast average gas demand in the Lower 48, including exports, to increase from 107.3 bcfd last week to 108.4 bcfd next week before sliding to 107.3 bcfd in two weeks. This two-week outlook may be revised higher in the wake of the warmer NWS forecast. The Baker Hughes rig count showed US natural gas rigs in operation were unchanged at 108 rigs last week. This was up from 100 rigs a year ago but below the five-year average of 113.
PRODUCTS
Last week’s EIA stocks report showed US distillate inventories were the lowest since April 2005.
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