Each week, Al Attiyah Foundation publishes its energy market review, bringing you the latest global news from the oil, gas and petrochemicals sector.


Al-Attiyah Foundation - Weekly Energy Market Review

Oil Ends Lower, Posts Weekly Decline as US Rate Cut Hopes Dim

Oil prices fell nearly 3% lower on Friday, 23 February, and posted a weekly decline after a US central bank policymaker indicated interest rate cuts could be delayed by at least two more months. Brent crude futures settled down USD2.05, or 2.5%, at USD81.62 a barrel, while US West Texas Intermediate crude futures (WTI) lost USD2.12, or 2.7%, to close at USD76.49. For the week, Brent declined about 2% and WTI fell more than 3%. However, indications of healthy fuel demand and supply concerns could revive prices in the coming days. Federal Reserve policymakers should delay US interest rate cuts by at least another couple of months, Fed Governor Christopher Waller said on Thursday, which could slow economic growth and curb oil demand. The Fed has held its policy rate steady in a 5.25% to 5.5% range since last July. Minutes of a central bank meeting last month show most bankers were worried about moving too quickly to ease policy. Meanwhile, Gaza truce talks were underway in Paris in what appears to be the most serious push in weeks to halt the conflict in Palestine and see Israeli and foreign hostages released. Ceasefire talks could prompt the market to anticipate an easing of geopolitical tensions, analysts said.


Asia Spot LNG Prices Hit Near Three-Year Lows as Weak Demand Weighs

Asian spot LNG fell to a fresh low last week, easing to its lowest levels in nearly three years, as weak demand in Asia and Europe weighed on prices. The average LNG price for April delivery into north-east Asia fell USD0.50 last week to USD8.30 per mmBtu, its weakest levels since mid-April 2021. Asian and European pricing has been declining in tandem on the back of fundamental weakness and the absence of a relative floor in both basins. There could be a brief reprieve as some players cover at attractive spot levels, but this might not sustain and further dips to historical normalcy could prevail, analysts said. Asian spot LNG prices have lost nearly 30% of their value since the start of the year amid tepid demand and healthy inventories in both east Asia and Europe. The fall in prices had incentivised LNG importers from markets like China and India to increase spot purchases. In Europe, gas price was down on Friday, hitting its lowest level in almost three years. The Dutch TTF contract, which is seen as a bellwether for European gas prices, has fallen around 25% this year due to weak demand from power plants amid strong renewable output and as milder weather than usual for the time of year curbs demand for heating.

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