East Daley Analytics Releases 2023 Outlook on Midstream Energy Sector Trends
Annual Dirty Little Secrets Report Reveals Increased Demand for Crude and LNG Exports in 2023
GREENWOOD VILLAGE, Colo.–(BUSINESS WIRE)–#crudeoil—East Daley Analytics has released its 2023 Dirty Little Secrets (DLS) annual market report on midstream energy sector trends. The report highlights East Daley’s macroeconomic outlooks for U.S. oil, natural gas and NGLs, including key risks, potential infrastructure opportunities, and how ever-increasing export demand will impact Midstream strategy for years to come.
The Russia-Ukraine conflict has pushed commodity prices higher and spurred greater global demand for U.S. energy products. Meanwhile, more disciplined growth from the upstream has infrastructure finally filling up across commodities.
“We are on the verge of the next infrastructure wave, and that infrastructure will center around getting oil and gas out of the U.S.,” said Ajay Bakshani, Senior Energy Analyst at East Daley Analytics, and author of the report. “High prices and disciplined production have infrastructure finally filling up across commodities leading to an increased opportunity for crude and LNG exports.”
Highlights of the report include:
The Bottom is in for Crude Transport Rates
During the last major crude infrastructure buildout from 2019-2021, four new pipelines added just under 4 MMb/d of capacity to U.S. Gulf Coast destinations (Houston and Corpus Christi). East Daley expects these pipes to finally start filling up, effectively putting an end to rock-bottom rates. The key long-term driver for demand is exports, and new investment will need to focus on location and the best place to export crude.
The Sky’s the Limit for LNG Exports
The outlook for LNG exports has never been brighter. By the end of this decade, U.S. liquefaction capacity could expand to nearly 30 Bcf/d, fueling long-term demand growth for natural gas. However, new infrastructure is needed to get gas to these export facilities and most of this LNG demand is coming online in 2024 and beyond. In the short-term, increased production will only drive-up domestic storage and pressure U.S. gas prices.
Not Enough Frac Capacity
East Daley expects bullish production for NGLs in the near-term, but more fractionation capacity is needed to manage NGL production without excessive flaring. Add in recession risks that are keeping petrochemical utilization rates down and little domestic demand growth from new ethane cracker projects, NGL prices may be heading for a rough patch.
East Daley will be hosting a webinar on the 2023 DLS Report on Wednesday, December 14, 2022 at 12:30 p.m. EST. Register here.
To access the full 2023 DLS Report, fill out the form: https://www.eastdaley.com/dirty-little-secrets-request-access.
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About East Daley Analytics, Inc.
East Daley Analytics specializes in dissecting the energy value chain to drive transparency. The company has built the largest U.S. energy asset database to cash flow to help identify which assets are most important and isolate their operational value. It can help with the heavy lifting by providing access to capital and commodity market experts through both subscription and consulting services. For more information visit, http://www.eastdaley.com.
Contacts
East Daley Analytics
Meredith Bagnulo
mbagnulo@eastdaley.com
303-513-7494
