Page 5 - Policy Economic Report - December 2024

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Further, India’s total exports (Merchandise and Services combined) for November 2024 is estimated at
USD 67.79 Billion, registering a growth of 9.59 percent vis-à-vis November 2023. Total imports
(Merchandise and Services combined) for November 2024 are estimated at USD 87.63 Billion, registering
a growth of 27.47 percent vis-à-vis November 2023.

As far as oil and gas industry is concerned, the decision by OPEC+ to delay the unwinding of its additional
voluntary production cuts by another three months and extend the ramp-up period by nine months
through September 2026 has materially reduced the potential supply overhang that was set to emerge
next year. Even so, persistent overproduction from some OPEC+ members, robust supply growth from
non-OPEC+ countries and relatively modest global oil demand growth leaves the market looking
comfortably supplied in 2025.

Hedge funds and other money managers adopted a less bearish outlook on crude oil compared to late
October, although their positions showed mixed trends throughout the month, contributing to increased
volatility in oil futures prices.

The premium of light sweet crude over medium sour crude showed mixed trends across regions but
remained largely little changed m-o-m. In Europe, the sweet-sour differential widened due to weak
demand for sour crude and lower high-sulphur fuel oil margins. In Asia, the spread was little changed.
However, in the USGC, the spread narrowed as sour crude gained support from higher fuel oil margins
while light sweet crude faced pressure due to high availability and lower margins for naphtha and gasoline.

Natural gas spot prices at the US Henry Hub benchmark averaged $2.12 per million British thermal units
(MMBtu) in November 2024. Henry Hub's natural gas prices experienced a consecutive monthly decline
in November, falling by ~4.0%, m-o-m. Prices rose earlier in the month on the back of higher heating
demand. However, the absence of an expected winter storm reduced heating demand, therefore putting
downward pressure on prices. Reports of robust storage levels added more downward pressure on prices.
According to data from the US Energy Information Administration (EIA), weekly average underground
storage rose in November by 5.7%, m-o-m, and it is around 8% above the five-year average (2019–2023).
Henry Hub prices were down by ~22.0%, y-o-y.

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