Deal Signing Tomorrow

Week 28 Opens: Strategic Positioning

Monday, July 13, 2026. WEEK 28 OPENS. WTI crude oil trading ~$74.42 (open $73.79, high $74.64, low $73.72, +0.87%). Sharp rebound from prior session. CME live quote late Jul 12 showed $74.36 (+4.13% or +$2.95 on day). CRUDE OIL SETUP: Prices risen from lows near $68-$71 earlier in July. Upward momentum into mid-month (fluctuated $68.55 Jul 6 to $73.52 Jul 8). Well below 2025-early 2026 highs (over $100 in some periods). KEY LEVELS: Resistance $74 (potential decision point for bullish moves above or bearish below ~$70). Support $70, resistance $75-$76. TECHNICAL SETUP: Crude consolidating mid-$70s range. Doha talks progress supporting sentiment. Watch for Strait of Hormuz developments. Geopolitical premium intact but fading. NATURAL GAS: Most recent spot Jul 6 $3.29/MMBtu (down from $3.34 prior day). Futures Jul 12 ~$2.915/MMBtu (-0.025 or -0.85%). Jul 10 futures close ~$2.95 (or $2.94 in some reports). Earlier July spot hovered $3.21-$3.34. DOHA TALKS UPDATE: Indirect US-Iran technical talks in Doha concluded ~Jul 1-2, 2026. Focus on Strait of Hormuz/related issues under earlier interim MOU. FORMAT: Indirect/technical talks (not direct bilateral meetings in all accounts). US envoys Steve Witkoff/Jared Kushner meeting Qatari officials (Emir/Prime Minister) alongside Iranian technical delegations via mediators. Qatar/Pakistan facilitated. PRIMARY TOPICS: Maritime traffic/shipping resumption through Strait of Hormuz (critical chokepoint handling ~20% global oil trade). Unfreezing Iranian assets/funds (~$6B references). Implementation of prior MOU/ceasefire. OTHER TOPICS: Nuclear issues, Lebanon ceasefire, broader peace discussed but limited headway. OUTCOMES: "Positive progress" or "building on" Jun interim MOU that halted fighting. Both sides agreed continue talks. No breakthrough on lasting peace deal or full nuclear agreement. VP Vance described talks as "going well" and "still pretty early." CONTEXT: Followed tit-for-tat US-Iran strikes over Hormuz shipping disputes earlier 2026. Initial interim deal mid-Jun 2026 halted attacks, reopened strait to pre-war shipping levels, extended ceasefire (~60 days in some reports), paved way for further nuclear talks. Iran faced accusations of attacks/toll proposals; US pushed against fees/tolls in favor of broader economic incentives. RECENT DEVELOPMENTS: Talks occurred ahead of/around funeral for Iran's former Supreme Leader Ali Khamenei (killed in earlier strikes). Some reports noted pauses/questions about resumption post-funeral (around Jul 11) amid mentions of additional US strikes. STATUS: As of early Jul, existing Hormuz-related agreements remained in place despite stalled broader negotiations. THE READ: Crude consolidating mid-$70s, Doha talks progress supporting sentiment, geopolitical premium intact but fading. Support $70, resistance $75-$76. Gas $3.29 spot, $2.915 futures, accumulation zone intact. WEEK 28 THESIS: Crude Doha talks progress positive, Hormuz risk declining, geopolitical premium fading. Support $70, resistance $75-$76. Gas accumulation zone intact, target $4.00+. Trade the data, not the headlines.

Geopolitical Tensions Rising

Wednesday, January 8, 2026. WEEK 2 MIDWEEK UPDATE. WTI crude oil settled at $57.76, up $1.77 or 3.2%. Sharp rebound after two consecutive days of declines. Two-week high. Brent up 3.4% to $61.99. KEY DRIVERS: US actions on Venezuela's oil sector following reported capture of former leader Nicolas Maduro. Energy Secretary Chris Wright announced US oversight of Venezuelan crude sales. Intensified sanctions including seizure of Venezuela-linked oil tankers (one reportedly under Russian flag). Geopolitical tensions/supply concerns involving Russia, Iraq, Iran. President Donald Trump warning to Iran regarding protests/potential crackdowns. Broader reassessment of geopolitical shifts in Americas/Middle East. NATURAL GAS: Henry Hub spot price ~$2.92/MMBtu Jan 8, 2026. Low $3 range or below around that time (below $3 Jan 9). Note will spike sharply later month due to Arctic blast (all-time highs near $28-$30/MMBtu around Jan 23-26). IRAN/STRAIT OF HORMUZ: Strait remains open with normal shipping traffic but geopolitical tensions rising sharply. Internal Iranian unrest, US warnings of potential military intervention. Market concerns over possible future disruptions to crude oil flows (normally ~20-25% global seaborne oil trade). PRE-CONFLICT BUILDUP: Iranian protests erupted late Dec 2025, intensified Jan 2026 after brutal crackdown. US threatened intervention, raising fears escalation could prompt Iran to threaten/close Strait. MARKET WARNINGS: Jan 12, 2026 report highlighted Strait returning to focus amid possible US action against Iran. Experts cautioning confrontation could lead Tehran to disrupt chokepoint. OIL PRICE OUTLOOK: BloombergNEF analysis projected Brent averaging $55/bbl for 2026 (assuming no major Iran-related disruptions) but noted risks of prices reaching $91/bbl in disruption scenario. POLYMARKET BETTING: Contracts on whether Iran would close/restrict Strait by Jan 31, 2026 resolved to No (reflecting no closure occurred in month despite tensions). BROADER FLOWS: EIA data showed Strait of Hormuz crude/condensate flows averaging ~20-21M bpd in prior periods; no Jan 2026 specific drop reported. THE SETUP: Crude Venezuela focus, Iran tensions rising, geopolitical premium building. Support $55, resistance $60. Gas $2.92/MMBtu, Arctic blast coming late month, expect volatility. WEEK 2 THESIS: Crude geopolitical premium building, Venezuela sanctions, Iran tensions. Watch for Strait escalation risk. Support $55, resistance $60. Gas expect volatility, Arctic blast late month, heating demand coming. Trade the data, not the headlines. TEAM NOTE: Energy Markets Daily team taking break this week and next. Usual daily cadence will return soon. Thank you for attention and support.

Geographic Spotlight: Ecuador

Friday, July 3, 2026. GEOGRAPHIC SPOTLIGHT: ECUADOR. CURRENT PRODUCTION LEVELS: Ecuador's crude oil production averaged ~461,000-466,000 bbl/d Jan-Feb 2026. Daily lifts reported ~452,817-458,207 bbl/d late Feb/early Mar. RECENT OUTPUT DECLINE: National production fell 1.5% YoY Jan-May 2026 period, continuing broader downward trend from 2025 lows (reported ranges ~349,000-465,000 bbl/d). INCREMENTAL GAINS H1 2026: Government and Petroecuador efforts added 35,000+ bbl/d incremental crude production H1 2026. Major contributions from fields Sacha (~10,510 bbl/d), Auca, Lago Agrio, others. EXPORT VOLUMES: Crude oil exports 337,333 bbl/d Dec 2025 (down from 356,000 in 2024). Earlier periods showed exports representing large share production (historically ~67% net). EXPORT VALUE/SHARE: Mineral fuels/oil ~20.9% total exports by value recent data (down ~19% YoY). Though crude/related products historically comprised ~36% Ecuador's exports. CHALLENGES/INFRASTRUCTURE ISSUES: Production declines stem from aging/coroded infrastructure, frequent pipeline disruptions, underinvestment, policy factors. 2025 output described as 2-decade low in some reports. GOVERNMENT RECOVERY EFFORTS: Noboa administration pursued drilling rigs, field optimizations, multi-year investment plan. Targeting peaks above 600,000 bbl/d longer-term. Nearer-term goals >477,000 bbl/d possible by mid-2026 (including private operators). TRADING ECONOMICS FORECAST: Production expected ~445,000 bbl/d by end Q2 2026. Trending toward ~490,000 bbl/d 2027, ~530,000 bbl/d 2028 per econometric models. MARKET/EXPORT RISKS: Competition from rising Venezuelan heavy crude output could pressure demand/prices Ecuador's key export grades (e.g., Napo). Spot market sales emphasized in prior strategies. BROADER ENERGY/EXPORT CONTEXT: Oil remains core export/fiscal contributor. Non-oil exports (shrimp/fish) grown in importance. IEA notes historical net crude export trends/energy shares. BOTTOM LINE: Ecuador mid-sized crude producer facing infrastructure challenges/policy headwinds. Recent government efforts show incremental gains, recovery trajectory positive but gradual. Export competition from Venezuela and regional dynamics remain key risks.

Geographic Spotlight: Belarus

Thursday, July 2, 2026. GEOGRAPHIC SPOTLIGHT: BELARUS. PRODUCTION OVERVIEW: Belarus produced ~25,000 bbl/d early 2026 (well below historical avg 33,650 bbl/d since 1993). Production reached 30-year high 2.013M metric tons 2025. Belorusneft targets 2.1M tons 2026, 2.3M tons by 2030 (supported by intensified drilling 100 wells planned, enhanced recovery technologies). RESERVES: 198M barrels as of 2025 (ranking ~57th globally; ~0.011% world total). HEAVY RELIANCE ON RUSSIA: Russia sole supplier crude oil/natural gas. Imports at preferential/political prices (gas ~$130/1000 m³ since 2018; oil linked to Urals with discounts). Provided Belarus substantial economic benefits (~$5.5B extra from 2022-2025 oil discounts). REFINING/PRODUCT EXPORTS: Belarus refines Russian crude, exports petroleum products. Growth expected in product transportation volumes. Some flows via Russian infrastructure (Ust-Luga port). GAS SUPPLY UNCERTAINTY: Late 2025/early 2026 Belarus lacked publicly confirmed long-term gas contract with Russia despite Lukashenko's statements. Negotiations continued over pricing/terms. EU SANCTIONS IMPACT: Extensive EU sanctions target Belarus's energy, trade, financial sectors (bans imports certain mineral products, exports luxury goods). Contributing to sharp drop EU trade, forcing pivot to Russian/Asian markets. 2026 SANCTIONS PACKAGES: EU's 20th sanctions package Apr 2026 added parallel measures against Belarus alongside Russia-focused actions (targeting military-industrial complex, energy sector circumvention, crypto services, more). GEOPOLITICAL ALIGNMENT: Sanctions and Russia-Ukraine war accelerated Belarus's economic, military, political integration with Russia (Russian military presence, nuclear weapons deployment). Fostering ties with China (SCO membership, BRICS partner status). GLOBAL RANKING: Belarus ranks ~70th world oil production (~27,846 bbl/d 2024 data). Focuses domestic needs plus limited product exports, not significant crude exports. BOTTOM LINE: Belarus minor oil producer deeply integrated with Russia for energy supplies, refining, exports. Amid ongoing EU/US sanctions and geopolitical alignment with Moscow. Limited upstream autonomy, strategic dependence on Russia. Western sanctions pressure continues.

Strategic Positioning: Week 27 Midweek Update

Wednesday, July 1, 2026. WEEK 27 MIDWEEK UPDATE. WTI crude oil trading ~$69.98-$70.42. EIA Weekly Petroleum Status Report released today (covering week ending Jun 26, 2026). CRUDE OIL INVENTORY UPDATE: Latest reported week ending Jun 19, 2026 crude fell 6.088M barrels to 412.1M barrels (7% below 5-year avg). Cushing, Oklahoma stocks down over 1M barrels in latest week. BROADER CONTEXT: OECD stocks heading toward multi-decade lows driven by Iran-related conflict and Strait of Hormuz issues. EIA Short-Term Energy Outlook Jun 2026 forecasts 6.3M bpd global inventory declines in Q2 2026. Brent prices expected ~$105/bbl Jun/Jul before potential easing later in year. REFINERY ACTIVITY: Runs and utilization high to offset supply gaps, contributing to inventory draws. GASOLINE AND DISTILLATE STOCKS: Gasoline +2.064M barrels, distillates +3.064M barrels (contrasting crude draw; refineries running hard to produce products). NATURAL GAS: No EIA storage report today (releases occur Thursdays 10:30 a.m. ET). Next release Jul 2, 2026 (covering week ending Jun 26, 2026). Latest storage data week ending Jun 19, 2026: Working gas in storage 2,835 Bcf. Net injection +76 Bcf from prior week. Year-over-year 49 Bcf below same week 2025. Five-year average 152 Bcf above average. THE SETUP: Crude inventories falling, multi-decade lows, support for higher prices, but WTI trading $70, consolidation continues. Support $67.93, resistance $71.84. Watch for EIA data surprises. Doha talks ongoing. Gas storage building, injections strong, accumulation zone intact. WEEK 27 THESIS: Crude fade trade complete, mean reversion delivered, geopolitical premium fading but Hormuz risk remains. Short any bounces above $72. Target $65-$67. Gas storage building, injections strong, accumulation intact. Target $4.00+. Trade the data, not the headlines.