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Daily Market Update July 20, 2020

Early Morning Update

The Aug20 natural gas contract is trading down $0.06 at $1.66.  The Aug20 crude oil contract is down $0.29 at $40.30. 

Summary

On Friday, the August 2020 NYMEX natural gas futures price barely budged, moving down just half of a cent and settling at $1.718/MMBtu. The prompt month is down just under a dime week-over-week, the first loss over the past few weeks despite the heat seen last week for the majority of the country. Peak demand alerts were sent for today for PJM, NEPOOL, and NYISO, as many regions in the Northeast are expected to see high demand due to the hot temperatures. Through the end of this month, the blanket of heat covering the Northeast spreads westward into the Great Lakes region in the 6-10 day forecast. The 11-15 day outlook is showing the heat continuing to move to the west, covering the majority of the country with the exception of the bottom of the country from California to Florida. While this type of summer weather would normally prompt a rally to the gas and power markets as demand significantly increases due to cooling demand, it is currently muted due to lower industrial demand and LNG exports, which are only 1/3 of where we were at the start of this year. So far this month, U.S. dry production is averaging just over 87.0 Bcf/d, slowly creeping up despite the rig count declines, and down about 3.0 Bcf/d versus last year.

Market Update072020

Market Settles 071720

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