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The Energy Report

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


It’s Only A Drill Baby, Only a drill! The Energy Report 04/23/2026

Drill baby drill keeps prices lower, but an Iran Miltary drill caused a market panic overnight. The gas price at the pump slide ended overnight jumping to $4.031 a gallon up 1.1 cent a gallon and WTI oil spiked briefly over $97 a barrel overnight and Brent Crude over $106 a barrel on unconfirmed reports of gunfire and explosions near the Strait—later identified as an Iranian air defense drill—only a drill baby. Still, it triggered a panic buy that sent WTI Crude up nearly 5% within minutes, hitting an intraday high of $97.22/barrel before retreating.

This latest oil price spike underscores that tensions in the global energy markets remain elevated, but it also highlights America’s firm stance in protecting international shipping lanes and enforcing accountability . It also shows how America’s Drill baby Drill policies are reducing Iran’s leverage and its attempt to use their terrorizing of the Strait of Hormuz to bring down the global economy. But Iran keeps trying.

Iran’s Revolutionary Guard Corps (IRGC) claimed responsibility for seizing two container ships—the Panama-flagged MSC Francesca and the Liberia-flagged Epaminondas—while firing on a third vessel in the Strait of Hormuz, alleging they crossed without “authorization.” The IRGC escorted the seized ships toward the Iranian coast, again terrorizing this this vital chokepoint that carries a significant portion of the world’s oil and LNG flows.

In sharp contrast, the United States isn’t targeting innocent commercial vessels. Instead, the U.S. Navy has conducted precise, lawful interdictions of Iranian-linked oil tankers and cargo ships in international waters as part of a targeted naval blockade and sanctions enforcement campaign. These actions directly hit Iran’s primary revenue source—illicit oil exports—costing the regime millions of dollars per day in lost income. Reports indicate the U.S. has intercepted or turned back over 20-27 vessels attempting to breach the blockade, demonstrating Washington’s determination to maintain pressure without unnecessary escalation.

This proactive American strategy sends a clear message: the U.S. will not tolerate threats to global energy security or violations of international norms. By disrupting Iran’s shadow fleet and shadow economy, America is leveraging its naval superiority and sanctions toolkit to protect allies, stabilize markets long-term, and encourage responsible behavior from Tehran. While short-term volatility in oil prices can occur, the U.S. approach strengthens deterrence and keeps the world’s critical sea lanes open for legitimate trade.

Oil also found solid support from a larger-than-expected draw in U.S. product inventories, driven by strong product demand, robust exports, and ongoing refinery maintenance that’s keeping runs in check. Yet the real story was the fact that US petroleum products exports surged to a remarkable new all-time high of 8.083 million barrels per day (bpd) in the most recent reported week, marking the second consecutive week of record-breaking performance and showcasing the incredible strength of America’s refining and export machine.

This impressive milestone followed several already powerful weeks, with products exports consistently hovering in the strong 7.5–7.9 million bpd range, demonstrating sustained momentum and robust global demand for US-made fuels and the US oil industry is the reason global oil prices have not hit the lofty price levels that many called for during this major historic supply disruption.

For even more exciting context, total US oil-related exports (crude oil plus petroleum products combined) also smashed records, climbing to 12.7 million bpd — with peaks reaching as high as ~12.74–12.88 million bpd in recent weeks. That included a massive ~1 million bpd week-over-week jump in mid-April, highlighting the rapid acceleration in shipments.

Meanwhile, crude oil exports alone powered higher to around 5.2 million bpd, another standout record level fueled by strong buying interest from Asia as the US continues to step up as a reliable and dominant global energy supplier.

For the overall data the EIA showed that U.S. commercial crude oil inventories (excluding the Strategic Petroleum Reserve) posted a modest build of 1.9 million barrels last week, bringing the total to a comfortable 465.7 million barrels. That’s still about 3% above the five-year average for this time of year — keeping the crude market well-supplied and balanced.

Product stocks tightened as refinery maintenance and record US oil and product exports caused motor gasoline inventories to fall by 4.6 million barrels just 0.5% below the five-year average. Finished gasoline stocks actually increased while blending components drew down.

Distillate fuel inventories that are the major concern in the global market dropped a healthy 3.4 million barrels and are running a solid 8% below seasonal norms. Propane/propylene stocks rose 2.1 million barrels but remain significantly elevated at 69% above the five-year average. Overall, total commercial petroleum inventories declined 1.8 million barrels last week.

On the demand side things are looking very solid with total products over the last four weeks averaged a robust 20.5 million barrels per day — up a strong 3.0% from the same period last year. Motor gasoline demand averaged 8.8 million barrels per day, climbing 1.7% year-over-year. Distillate fuel demand averaged 4.0 million barrels per day, surging 3.4% higher than last year. So there are no real signs of deamd destruction here.

The only soft spot in the product mix was jet fuel, which saw a 6.5% decline in product supplied as tight supplies continue to ripple through the market.

US jet fuel inventories are at their tightest levels in over 60 years, with the EIA forecasting days of supply dropping to around 21 days in 2026 — the lowest since 1963.

This tightness, driven by strong global demand, refinery capacity reductions, and elevated exports (which hit a record 442,000 bpd earlier in April), is starting to impact airlines.

Carriers are responding by trimming flight schedules, raising fares and baggage fees, and in some cases canceling routes to manage soaring jet fuel costs and availability concerns, especially on international routes. While the US remains more insulated than Europe or Asia, the pressure is real and could lead to further capacity adjustments this summer travel season.

Yet overall, it was a powerhouse showing for American energy overall — proving once again that the US is leading the way on the world stage with record export volumes and a bright signal for continued economic strength.

Sunshine on my shoulder season makes me happy. Natural gas futures can make you cry. Natural gas is trading quietly in the shoulder season as the market digests a transition from winter to spring demand patterns.

The May Nymex contract settled around the $2.71–$2.72 area yesterday and showed modest overnight action, holding steady to slightly softer in thin early trading. Traders are watching for any signs of life as we roll into the front-month period with storage builds still coming in at or above seasonal norms.

Overnight, the market saw limited volatility with prices hovering near recent five-month lows. A brief flirtation with the $2.68–$2.75 zone reflected the typical post-winter lull, where mild shoulder-season temperatures across much of the U.S. are muting heating demand while production remains robust. Global headlines tied to the ongoing Middle East situation continue to lift international LNG benchmarks (TTF and JKM), but the domestic Henry Hub stays relatively insulated, trading well below those elevated overseas levels.

Looking ahead, FOX Weather models are showing a mixed bag with temperatures flipping between cooler shots into the Midwest and South, then trending warmer again. Early indications point to a warmer-than-normal pattern dominating much of the eastern and southern U.S. in the coming weeks, which should keep cooling demand in check and support continued storage injections as we head toward summer. Any surprise cooler surges could spark short-covering, but the overall bias remains bearish on weather-driven demand for the next 7–14 days. Bottom line: Nat gas remains in a holding pattern — plenty of supply, modest demand, and weather that isn’t giving bulls much to cheer about yet. Watch for any shifts in the 6–10 day forecast or fresh EIA storage data for the next directional cue. Range-bound trade likely continues unless something breaks the current weather so download the Fox Weather Ap to stay up to date. Also stay tuned to the Fox Business Network. Call me to open your account today at 888-264-5665 or email meat pflynn@pricegroup.com



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Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. PFGBEST, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

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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Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Alaron Trading Corp. its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Contact Phil at 1-888-264-5665 or pflynn@pricegroup.com.