Daily Market Update July 23, 2020
Early Morning Update
The Aug20 natural gas contract is trading up $0.01 at $1.69. The Sep20 crude oil contract is down $0.20 at $41.70.
Summary
The NYMEX natural gas market saw less than a penny increase in the Aug '20 prompt month contract yesterday, closing out the day at $1.68/MMBtu. The 12-month strip and all future calendar strips remained basically unchanged from the previous day. Revised weather forecasts for the next five days show widespread warmth in the East and Midwest, which could support the penny increase in the prompt month contract. Beyond that, above-normal temperatures remain in the forecast for the next 20 days, but revised weather forecasts are showing lower temperature variances from normal than previously projected, specifically in the next 6-10 days in the East. The downward revision in temperatures should translate into less peak demand alerts for the NYISO, ISO-NE, and PJM territories over the next week or two. Looking ahead, the U.S. Energy Information Administration will release their weekly storage report later this morning. Market analysts are expecting an injection somewhere in the neighborhood of 36 Bcf to be reported. If this actualizes, it would be just under the 5-year average mark of 37 Bcf.
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