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The Energy Report

Phil Flynn
http://www.pricegroup.com/
pflynn@pricegroup.com


Iran Talks. The Energy Report 02/09/2026

Oil prices are still trying to assess the progress on the US Iran talks even as a report on Zero Hedge says that a massive number of C-17 globe master military transport cargo planes have been observed heading to Europe in the Middle East which appears to be like the major build up before for a possible war in Iran this comes as US energy secretary Chris Wright says that he believes that we could see Venezuelan elections in 18 to 24 months as the progress on Venezuela is very amazing and it could lead to a return of the Venezuelan nationals to help rebuild their country. Wright reaffirmed the U.S. commitment to a democratic transition, expecting elections in the next 18 to 24 months through cooperation with interim authorities and economic incentives like the oil sector. He dismissed domestic concerns from some U.S. oil producers and lawmakers that increased Venezuelan supply could hurt American companies amid low prices, calling competition a beneficial aspect of capitalism that drives innovation.

And regardless what you might think energy secretary Chris Wright says the trump administrations against the Maduro regime was not about the oil he said that Venezuela under Maduro was a regional threat because of its role in exporting drugs guns and criminals to the United States and insisting that the country’s oil wealth was condensed that coincidental to the decision making but not the primary motivation.

Of course there’s no doubt that the administration’s plans to revive Venezuelan oil sector is going to help lower oil prices consumers just another benefit but he points out that even when the company has suffered from corruption mismanagement and under investment and it’s reducing its output significantly from past lives he himself intends to chair the Venezuelan oil fields and initiate dialogue umm oil fields and initiate dialogue on PdVSA’s future leadership, while noting it remains a Venezuelan company. Still I’m sure the trump administration based on past comments from President Trump will make suer the American people get rewarded for their revitalization of the energy industry in Venezuela.

They are also I am sure will aim to expand from rebuilding their oil sector into mining, as the US seeks reliable rare earth mineral sources both at home and abroad. China’s monopoly on these minerals has given it political leverage and they have already signed they will use their rare earths as a political and economic weapon.

Wright reaffirmed the U.S. commitment to a democratic transition, expecting elections in the next 18 to 24 months through cooperation with interim authorities and economic incentives like the oil sector. There was a lot of criticism of the trump administration leaving interim Venezuelan president delcy Rodriguez in charge because she was a Maduro lackey but the trump administration did not want to dismantle the whole system by removing her and creating problems until the transition was smooth now after the country stabilizes they can have a free and fair election where if she chooses to Pulitzer Peace prize winner and most likely winner of the lase Venezulan election Maria Corina Machado will most likely be favored to win.

Wright also dismissed domestic concerns from some U.S. oil producers and lawmakers that increased Venezuelan supply could hurt American companies amid low prices, calling competition a beneficial aspect of capitalism that drives innovation. Of course he should also point out that the US oil producers do not produce that heavy oil that our US refineries are built for not in the amount that they need to so there’s going to be some benefit for the refining sector. This is a major moment because remember Venezuela has the largest oil reserves in the world, mostly made up of very thick oil in the Orinoco Belt. Back in the late 1990s, Venezuela was producing about 3.5 million barrels of oil each day. But by around 2020, that dropped to less than 500,000 barrels a day, and by late 2025, it was only about 800,000 to 1 million barrels a day.

This huge decline happened because of problems The corrupt socialist experiment from Chavez and Maduro stealing money from the industry and not making enough investment in oil projects, taking over foreign companies’ assets, poor upkeep of oil facilities, Firing and threatening skilled workers creating a massive brain drain as they fled country.

While the promise of Venezuela is real, the market is truly in a “wait-and-see” mode regarding what happens with Iran. We know the demand side of the equation continues to exceed expectations, and even the naysayers are not seeing the so-called oil glut that many predicted. There’s no doubt that the cold weather has created a lot of demand, but underneath it all, the strong economic growth in the United States is going to keep oil demand on an upward track. The leadership of the Trump economic team and tariff policies are definitely working for the American people, and they’re certainly working to drive the growth of oil demand as well.

We’ve seen the warm up here in the temperatures and that has definitely cooled down natural gas prices and the key thing is going to be to see what the storage looks like this week and what the weather looks like in the second-half of February but in the meantime we’re going to enjoy the warm up. Natural gas futures are taking another leg lower overnight/early Monday, with the March 2026 Henry Hub contract hovering around $3.20 per MMBtu—down roughly 6-6.5% from Friday’s settle near $3.42. That’s extending the pullback after last week’s volatility, and we’re seeing the market shake off the remnants of that brutal January cold snap.

The big driver here? Warmer weather forecasts dominating the tape. Above-normal temps are now locked in for much of the central and southern US starting later this week, with the milder pattern expected to spread eastward. That shift crushes heating demand expectations and takes the edge off power burn needs—straight-up bearish for consumption as we head deeper into February.

Adding fuel to the fire on the supply side: Drilling activity is picking up. The latest Baker Hughes rig count showed solid gains, particularly in the Haynesville Shale (up notably week-over-week, with US gas-directed rigs climbing overall). Higher rig counts signal more production potential down the line, and that’s layering on extra bearish pressure right now.

Flash back to late January—Winter Storm Fern delivered arctic-level cold, spiking spot prices to multi-year highs (some Northeast and regional hubs hit eye-popping levels, even $6-7+ at Henry Hub briefly, with extremes way higher in constrained areas). But the market’s reversed hard as that cold air retreated and forecasts flipped milder. Physical/northeast spots surged during the freezes but are now easing fast with the weather change. Overall, we’ve pulled way back from those January peaks. Futures are in a clear consolidation/decline mode after wild swings—including monster storage draws (like that record -360 Bcf week)—but the softening demand outlook is outweighing those inventory wins for now.

Looking broader: EIA’s latest view keeps 2026 relatively tame, with Henry Hub averaging around $3.50/MMBtu annually (slight dip from prior years as supply keeps up with demand). Then watch for a sharper move higher in 2027—potentially up 30%+—as LNG export ramps and power sector growth (think data centers, AI load) start outpacing production gains and tightening balances.

Fox Weather is reporting that :While much of the eastern U.S. has been frozen by rounds of Arctic air and snow, the West has experienced weeks of unseasonable warmth, which has left many mountain ranges in a snow drought. A major change in the weather pattern will flip the script by mid-month, as a shift in the jet stream will open the door for numerous storms to bring snow and rain to the West Coast and Rockies. Additionally, this shift in the jet stream will shield the East from the worst of the polar vortex, which will retreat farther north than earlier projections. Make sure you download the Fox Weather ap to keep up with the latest breaking weather news. Also Stay Tuned to Fox Business Network invested in you! Call to open your account at 888-264-5665 or email pflynn@pricegroup.com.



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Phil is one of the world's leading energy market analysts, providing individual investors, professional traders and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline and energy markets. Phil's market commentary, fundamental and technical analysis, and long-term forecasts are sought by industry executives, investors and media worldwide.

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