MDN’s Energy Stories of Interest: Tue, Jun 3, 2025 [FREE ACCESS]

OTHER U.S. REGIONS: Port of Corpus Christi completes milestone ship channel improvement project; Cheniere inks supply deal with Canadian Natural for SPL expansion project; NATIONAL: Forecasts fuel rally for natural gas futures, spot prices; US targets geothermal projects for emergency permitting; INTERNATIONAL: Oil advances as OPEC+ supply boost vies with geopolitical risk; JP Morgan asks if oil prices are $10 too low or $20 too high; Russian pipeline gas exports to Europe rose 10% m/m in May, data shows; U.S. sanctions threaten Europe’s Russian gas lifeline.

OTHER U.S. REGIONS

Port of Corpus Christi completes milestone ship channel improvement project
Port of Corpus Christi
The Port of Corpus Christi celebrated the completion of a $625 million Ship Channel Improvement Project on June 2, 2025, marking a significant milestone in enhancing U.S. energy export capabilities. The seven-year project deepened the Corpus Christi Ship Channel to 54 feet and widened it to 530 feet, making it the deepest draft port in the Gulf of America. This upgrade allows the port to accommodate Very Large Crude Carriers (VLCCs), boosting efficiency and capacity for crude oil and liquefied natural gas (LNG) exports. Funded through a partnership between the federal government ($425 million) and the port, the project positions the U.S. as a global leader in energy exports, particularly to markets like the Netherlands. The port moved a record 53 million tons in Q3 2024, a 2% increase from the previous year, reinforcing its role as a key economic driver for Texas and the nation. [MDN: The Port is also the second largest U.S. gateway for liquefied natural gas export. Hence our interest and celebration of this milestone achievement.]

Cheniere inks supply deal with Canadian Natural for SPL expansion project
Rigzone
Cheniere Energy Inc., through its subsidiary Cheniere Marketing LLC, has entered into a 15-year Integrated Production Marketing (IPM) agreement with Canadian Natural Resources Limited, starting in 2030, to supply 140,000 MMBtu per day of natural gas, equivalent to approximately 0.85 million tonnes per annum (MMtpa) of LNG. The LNG will be marketed by Cheniere at a price linked to the Platts Japan Korea Marker (JKM), with Canadian Natural as the guarantor. The agreement is contingent on a positive Final Investment Decision for the Sabine Pass Liquefaction (SPL) Expansion Project, which aims for a total production capacity of up to 20 MMtpa, including debottlenecking. Cheniere currently operates six liquefaction trains at Sabine Pass, each producing 5 MMtpa. In February 2024, Sabine Pass applied to the FERC for the Stage 5 Expansion, which includes two additional trains, a reliquefaction unit, and two large LNG storage tanks. [MDN: If Canadian Natural Resources can find a way to sell its natural gas from Western Canada to Cheniere along the Gulf Coast, we sure as heck can find a way to sell more M-U molecules there!]

NATIONAL

Forecasts fuel rally for natural gas futures, spot prices
NGI’s Daily Gas Price Index
On Monday, natural gas futures surged, with the July Nymex gas contract climbing 24.7 cents to $3.694/MMBtu, driven by hotter weather forecasts and a slight decline in production, despite bearish near-term weather and weak LNG feed gas flows. NGI’s Spot Gas National Avg. rose 13.0 cents to $2.365. The gains occurred amid growing inventories due to low shoulder season demand, with the EIA expected to report a 110 Bcf injection for the week ended May 30, marking a sixth consecutive triple-digit build, and another 100-plus Bcf addition anticipated for the current week. Weather models suggest a hot U.S. pattern from June 6-15, but the market’s focus is on whether mid-to-late June will trend hotter or cooler. Current inventories show a 98 Bcf surplus over the five-year average, with the market becoming better supplied, reducing upside potential and increasing downside risk, according to analysts. Warmer South Central forecasts signal stronger gas demand ahead. [MDN: The NYMEX price (and spot prices) are once again heading in the right (upward) direction, thanks to warmer weather on the way.]

US targets geothermal projects for emergency permitting
Reuters
The U.S. Department of the Interior has implemented emergency permitting procedures to accelerate geothermal energy project reviews, aligning with President Donald Trump’s energy agenda, as announced on May 30, 2025. This follows Trump’s declaration of an “energy emergency,” enabling faster environmental reviews for energy and mining projects on federal lands, reducing approval times from months or years to a maximum of 28 days. Three geothermal projects in Nevada, led by Ormat, are among the first to benefit, building on prior funding from 2020. Geothermal energy, which harnesses Earth’s heat for reliable, round-the-clock power, is seen as vital for national security and energy independence, supported by Interior Secretary Doug Burgum and Energy Secretary Chris Wright. Despite its potential to supply 10% of U.S. electricity, as per a recent U.S. Geological Survey report, geothermal currently accounts for less than 1% of U.S. capacity due to permitting delays and technical challenges. [MDN: Geothermal uses the same fracking technology used in shale drilling. We’re truly all of the above when it comes to energy. Geothermal is fine. We prefer natural gas, personally.]

INTERNATIONAL

Oil advances as OPEC+ supply boost vies with geopolitical risk
Bloomberg/Rigzone
Oil prices surged, with West Texas Intermediate rising 2.8% to approximately $63 per barrel, following OPEC+’s decision to increase production by a modest 411,000 barrels per day in July, a smaller hike than some anticipated, despite objections from members like Russia. This decision, coupled with the unwinding of bearish bets made before the OPEC+ meeting, contributed to the price increase, as speculative short positions in Brent reached their highest level in 2025. Geopolitical tensions further supported the rally, with Ukraine’s attacks on Russian air bases and Iran’s criticism of reports about its enriched uranium stockpiles reducing the likelihood of additional supply from sanctioned OPEC+ members. Additionally, wildfires in Canada, a major oil producer, threatened output. Prices were also influenced by ongoing U.S.-China trade war concerns, which could impact consumption, and a brief dip occurred after reports suggested a U.S. nuclear deal might allow Iran to continue uranium enrichment. [MDN: WTI for July delivery gained 2.8% to settle at $62.52 a barrel in New York. Brent for August settlement rose 2.9% to settle at $64.63 a barrel. Perfect prices.]

JP Morgan asks if oil prices are $10 too low or $20 too high
Rigzone
In a research note, J.P. Morgan analysts, led by Natasha Kaneva, debated whether oil prices are $10 too low or $20 too high, reflecting diverse client perspectives from marketing in Europe and Asia. The bullish case highlights robust oil demand, supported by strong economic data, optimism about U.S. growth from deregulation and tax cuts, and positive sentiment in China, where copper demand signals economic health and policy focuses on expanding domestic demand. High refinery margins and low global product inventories further support this view, with Brent and WTI trading in backwardation. Conversely, the bearish case points to accumulating oil inventories, with a 157 million barrel increase through mid-May, despite strong demand. China’s decarbonization reduces oil intensity, with refined product demand expected to contract. J.P. Morgan’s model estimates Brent’s fair value at $66 for June, expecting a slight decline by year-end due to inventory buildup, projecting an average of $66 per barrel for 2025. [MDN: An interesting article about what JP Morgan found in its talks with Europeans and Asians. One sentence caught our eye: “Perspectives are shifting away from concerns about a U.S. recession to optimism about growth-boosting deregulation and tax cuts.” So mainstream media couldn’t talk down the Trump miracle with the economy, and is now turning its attention to other ways to denigrate him. That is our takeaway. The left is dead and doesn’t yet realize it. They won’t win a major election for years to come, thankfully.]

Russian pipeline gas exports to Europe rose 10% m/m in May, data shows
Reuters
In May 2025, Russian energy giant Gazprom increased its average daily natural gas exports to Europe via the TurkStream pipeline by 10.3% compared to April, reaching 46.0 million cubic meters per day, according to Reuters calculations based on data from the European gas transmission group Entsog. This rise follows the expiration of a five-year transit deal with Ukraine on January 1, 2025, making Turkey the sole transit route for Russian gas to Europe after Ukraine declined to extend the agreement. The increase reflects seasonal demand and storage restocking in Europe, as well as Russia’s need for foreign currency amid sanctions. Despite the uptick, Russian gas now accounts for only 19% of Europe’s supply, down from 40% before the 2022 Ukraine invasion, with countries like Hungary and Slovakia continuing to rely on Russian gas via TurkStream, while others have diversified to U.S. and Qatar LNG. [MDN: Europe needs to cut all imports of Russian natural gas. They are making progress, but need to do better.]

U.S. sanctions threaten Europe’s Russian gas lifeline
OilPrice.com
European leaders are under pressure to reduce reliance on Russian natural gas, which funds Russia’s war in Ukraine, as U.S. sanctions threaten countries importing Russian energy with tariffs of at least 500%. Despite efforts to diversify, Russian gas imports via the Turkstream pipeline surged by 10.3% in May 2025, highlighting Europe’s ongoing dependence. The EU imported €209 billion in Russian fuels since the 2022 invasion, with Russia remaining the second-largest LNG supplier to the EU, generating €7.3 billion in 2024. Southern European nations like Bulgaria, Greece, and Hungary, reliant on Turkstream and the Druzhba pipeline, face significant risks from these sanctions. The EU aims to phase out Russian gas by 2027, but replacing it with U.S. LNG or renewables remains challenging. This situation underscores the need for Brussels to secure long-term, non-Russian energy contracts to ensure energy security and weaken Moscow’s revenue base. [MDN: It’s time to play hardball with Europe. If they keep importing Russian gas, they can expect 500% tariffs (destroying their economies). Which is it, Euro weenies?]