CTRA - U.S. crude oil slides below $70; natural gas plunges on record output

2023-05-30 18:35:22 ET

Crude prices fell to their lowest levels in nearly a month in the wake of concerns about whether the debt ceiling deal will pass the U.S. Congress as well as mixed messages from oil producers ahead of the OPEC+ meeting this coming weekend.

Tensions have been rising between Russia and Saudi Arabia, with Russia pumping increasing volumes of cheap heavy crude oil onto world markets, which has been undermining Saudi Arabia's efforts to boost prices.

Front-month Nymex crude ( CL1:COM ) for July delivery closed -4.4% to $69.46/bbl, and July Brent crude ( CO1:COM ) finished -4.6% to $73.54/bbl, both settlement values at their lowest since May 4.

"The big elephant in the room is the continued drama over the debt ceiling," Price Futures analyst Phil Flynn said, adding the market will remain on edge until the deal actually passes both the House and Senate - not a sure thing, as some Republicans vented their disappointment at the agreement.

U.S. natural gas futures ( NG1:COM ) continued their slide, with the new front-month July contract closing -3.7% to $2.327/MMBtu following last week's loss of 16%, on record production and forecasts for milder weather and lower demand over the next two weeks.

Data provider Refinitiv reported average gas production in the U.S. Lower 48 states rose to 101.7B cf/day so far in May, which would top April's monthly record of 101.4b cf/day.

Also, the National Oceanic and Atmospheric Administration's latest temperature forecast said demand will likely remain weak through June 12, with most of the lower 48 states expected to see below-average to near normal temperatures.

ETFs: ( NYSEARCA: USO ), ( BNO ), ( UCO ), ( SCO ), ( DBO ), ( USL ), ( DRIP ), ( GUSH ), ( USOI ), ( NRGU ), ( NYSEARCA: UNG ), ( UGAZF ), ( BOIL ), ( KOLD ), ( UNL ), ( FCG )

The day's biggest losers among oil and gas names on the S&P 500 were APA Corp. ( APA ) -3.5% , Coterra Energy ( CTRA ) -2.8% and EQT Corp. ( EQT ) -2.8% .

More on oil and gas:

• Oil Data Continues To Fly In The Face Of Skeptics
• U.S. Oil Demand Is Trending In The Right Direction, So It's Only A Matter Of Time
• United States Natural Gas Fund: Much Better Ways To Go Long Natural Gas

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