Energy Market Updates: Oil Prices Tick Up, Natural Gas Futures Rise, and Hydrogen Stocks Jump
Key Ideas
- Oil prices slightly increase as U.S. crude inventories drop, while gasoline and distillates see growth.
- Winter weather boosts U.S. natural gas futures with increased demand and production freeze-offs.
- Household spending on natural gas likely to remain stable despite recent price spikes due to adequate domestic supplies.
- Plug Power and Bloom Energy stocks surge after the Treasury Department issues new rules for tax breaks on clean hydrogen production.
The oil market saw stability with a slight uptick as investors awaited official data on U.S. inventories following a reported decrease in crude stocks and growth in gasoline and distillates. Natural gas futures were on the rise due to strong weather-driven demand in the U.S. and production freeze-offs. Despite a recent rally in natural gas prices due to cold weather, household spending on heating fuel is expected to stay steady thanks to sufficient domestic supplies. In other news, Shell warned of lower earnings in its integrated gas division for the fourth quarter, while Phillips 66 announced a $2.2 billion acquisition of EPIC NGL to expand its Permian midstream business. Meanwhile, ExxonMobil anticipated a decline in earnings due to lower oil prices but potential gains from gas price changes. Additionally, the Biden administration plans to ban drilling in some coastal waters, invoking a law that may pose challenges for future reversals. Notably, Plug Power and Bloom Energy stocks soared after new Treasury Department rules were issued, facilitating tax breaks for clean hydrogen production.