TPI Market Snapshot header
July 18 2022 Market Snapshot

THE NATURAL GAS MARKET SLOWLY CREEPING BACK

HIGH DEMAND AND LOWER PRODUCTION PUSH THE MARKET UPWARD

Natural gas chart
  •  Numerous maintenance issues pushed production down from 96 to 94 Bcf. Coupled with near-record temperatures in a high-pressure hot zone that refuses to move, the market rose almost $1.00 last week
  • The production drawback erased any benefits of the Freeport facility’s closure last week. We lost almost the same amount in production as we gained from the Freeport LNG facility being off-line.
  • If the maintenance issues pass, we may see a drop in the market in the next two weeks.

 A HEATWAVE IS STILL STUCK IN THE PLAINS STATES AND MIDWEST

weather map
USA WEATHER MAP SHORT AND LONG TERM OUTLOOK

Natural Gas Storage Report

EIA chart
EIA NATURAL GAS STORAGE REPORT FOR JULY 8 2022

Gazprom (Russia) has shut down the Nordstream1 pipeline for maintenance due to end on July 21st. There are varying opinions on whether it will be fully restored, partially restored, or if Gazprom reveals a new “detail” that causes the shutdown to last longer. This could roil worldwide gas prices and increase demand for US LNG.

Prepare for the next drop in the market.

Production is slowly increasing, and the Freeport LNG facility is still down. The dip we saw over the last few weeks has already dissipated, and those waiting have waited too long. Get them ready for the next opportunity, it will likely only be here for a short time.

Digital electric meters in a row measuring power use. Electricity consumption
Digital electric meters in a row measuring power use Electricity consumption concept 3d illustration

We are looking at a near record-breaking summer for heat, increasing cooling demand. It is worth it to look over simple measures businesses can take to alleviate related costs like: 

  • the staggering machine starts to help lower capacity tags, 
  • raising the thermostat 3-4 degrees
  • employing a third shift instead of a second shift to take advantage of off-peak hours.

The closing of the Freeport LNG facility has helped alleviate our natural gas shortage for next winter, but that facility may be partially operational by mid-October. Once that facility is back up and running, it will not lack LNG export demand.