NATURAL GAS: FROM $9.35 IN SEPTEMBER TO $3.11 IN JANUARY, THE NYMEX HAS FALLEN FAR
THE MARKET REMAINS VOLATILE ON COMPETING INDICATORS.
- The Eastern half of the U.S. will continue to see above-average temperatures after experiencing the warmest January on record. This reduction in demand has helped keep the premarket below $2.50
- Six months ago, on August 1st, the March NYMEX was $6.67. The market has fallen to $2.68, the settlement price at the close of January 31st. That is a drop of almost 250%.
- Steep drops in pricing are prevalent for the next 10-12 months from where they were a year ago. Future pricing settles down next February or March, with future pricing lining up today with predictions 12 months ago. The norm in 2024 seems to be around $4.00 in warmer months and $5.00 in winter.
- For the Eastern half of the U.S., this has been the warmest January on record.
A WARMER FORECAST IN THE EAST REDUCES THE DEMAND FOR ELECTRICITY AND NATURAL GAS
- The Eastern half of the U.S. will continue to see above-average temperatures after experiencing the warmest January on record. This reduction in demand has helped keep the premarket below $2.50
NATURAL GAS: FUTURES PRICING FOR THE NEXT YEAR HAS COLLAPSED
The market for future months has dropped by about $3.00 in the last 12 months. What had been priced at @$7.00 in January 2022 was now at $4.00 in January 2023. This difference in futures pricing between the previous year and this year begins to even out in early 2024, where the forecast has not changed much. The “new normal” next year looks to be about $4.00 except in winter when it will generally rise to $5.00
EIA NATURAL GAS STORAGE REPORT
- Mild temps have brought about better storage numbers for Natural Gas, with the current storage numbers above last year and the five-year average. This has also kept pricing low.
- The Freeport LNG Facility has not fully met the regulator’s requirements to reopen at 100%. Still, it will partially reopen in February with hopes of returning to 2.0 Bcf – 2.6 Bcf (full capacity) in early March. Once Freeport reaches 2.0 Bcf exported daily, that will be an extra 14 Bcf a week out of domestic storage.
NATURAL GAS: TOTAL US DEMAND 2021 AND 2022
PJM BGE HUB FORWARD POWER PRICING
PJM AD HUB FORWARD POWER PRICING
