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Daily Market Update April 15, 2019

Early Morning Update

The May19 natural gas contract is trading down $.05 at $2.61. The May19 crude oil contract is down $0.69 at $63.20.

 

Summary

With total U.S. demand for natural gas projected to drop from 81.1 Bcf/d to 74.6 Bcf/d later this week, fundamentals are looking very bearish these days. Near-record production and mild temperatures are erasing any type of price support, and this was evident on Friday, with the prompt month edging just slight lower to $2.66/MMBtu. In fact, longer terms were virtually unchanged day-over-day, with the 2020-2025 calendar strips all moving less than a penny, if at all. The storage situation looks much different than it did just a month ago, as well. There have been two injections so far this year, and the next three builds are estimated to be considerably greater than historical norms. Last year, withdrawals from natural gas stockpiles continued for another two weeks. The early jump on storage replenishment will completely erase the deficit to last year in two weeks, and the deficit to the five-year average should be significantly narrowed heading into next winter. Early summer forecasts show El Nino conditions persisting - warmer-than-normal temps for the Pacific Northwest, Northeast, and Atlantic Coast, with above-normal precipitation and cooler temps across Midcon and Texas.

 

Market Update 041519

Market Settles 041219

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