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Daily Market Update April 1, 2020

Early Morning Update

The May20 natural gas contract is trading down $0.02 at $1.62.  The May20 crude oil contract is up $0.18 at $20.30. 

Summary

Near-term NYMEX pricing moved down during yesterday’s trading session, as the prompt month lost five cents to close at $1.64/MMBtu. Much of the downward movement was in the front months, with the 12-month strip down just over a penny to close at $2.22. There wasn’t much movement at all out through the next calendar strips, as 2021 was unchanged, and 2023 through 2025 all moved just a couple tenths of a cent. With the cold front that moved through much of the country yesterday, overall demand was up, with the Res/Comm sector leading the way, up 3.5 Bcf/d and at a seven-day high. Today, as temperatures moderate, total demand is projected to be down 2.5 Bcf/d, while natural gas production is also expected to fall just over 2.0 Bcf/d to 90 Bcf/d. With the warmer-than-normal weather we’ve had lately, it is looking like the U.S. Energy Information Administration’s Natural Gas Storage Report tomorrow will show the last withdrawal of the season at around 26 Bcf. This compares to an early injection last year of 6 Bcf for the same week, and the 5-year average withdrawal of 19 Bcf, which would make it just the 6th time this winter that the weekly withdrawal was higher than last year.

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