LNG Market Snapshot
There has been no new addition to the global LNGC fleet, which consists of 366 vessels in total. The order book, however, expanded by 3 vessels to 110 units. Atlantic and Pacific LNG demand softened m-o-m, resulting in LNG prices down into the US$17-19/mmBtu range for early April deliveries and down to US$15/mmBtu for May. The LNG supply outlook remains tight until at least 4Q 2014. Spot charter rates also softened m-o-m as limited spot cargo availability reduced activity and the situation is likely to endure in 2014.Oil Market Snapshot
The average Brent oil price was stable at around $108/bbl in March. Developments in Crimea only had a minor impact on oil prices (short-lived $2-3/bbl spike). World oil supply jumped by 600,000 b/d in February, mostly from Iraq. Despite signs of a slowing Chinese economy, the world economy is projected to grow by 3.7% in 2014 (IMF). Oil market fundamentals are robust but a well supplied market could add some downward pressure on prices. CAPEX cuts across the oil industry are likely to limit majors’ production growth in 2-3 years from now.Bakken and Eagle Ford Shale Production
In February, the Bakken performed better overall compared to December 2013, with slower production decline and higher output but with fewer wells drilled. However, average per-well production of 580 b/d for 2013 was less than the peak in 2010. The Bakken's rig count was down compared to January 2014. Eagle Ford’s December 2013 production was up 31.4% y-o-y but down 3.2% m-o-m. The resource play’s rig count was also down compared to January 2014.
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