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Daily Market Update July 27, 2020

Early Morning Update

The Aug20 natural gas contract is trading down $0.03 at $1.78.  The Sep20 crude oil contract is up $0.21 at $41.50. 

Summary

As we begin another week, we are greeted with a wild week of weather across the country. In TX, Hurricane Hanna made landfall on Saturday in South Texas with a 5-foot storm surge and forcing power outages for thousands of residents. The storm has since moved inland, but is unleashing significant rainfall over interior Mexico today. The hurricane’s impact continues to be strong in TX, with temperatures running several degrees below normal for the next few days. The seemingly endless heat wave on the East Coast will peak again today, with potential for peak demand days across PJM, NEPOOL, and NYISO. Cities including Boston, Philadelphia, and New York City will all be in the mid to upper 90s, with little chance of thunderstorms today. The end to the heat is finally in sight, with forecasted temperatures by the weekend in the mid-80s for the region. The natural gas prompt month  settled on Friday at $1.808/MMBtu, and forward strips showed little movement over the week, with Cal ‘21 settling at $2.62, and the ‘22–‘24 calendar strips settling at $2.47/$2.44/$2.47, respectively. Even with the hot weather driving short-term demand, it’s clear that the COVID-19 pandemic overhang continues to weigh on forward prices.

Market Update072720

Market Settles 072420

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