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Daily Market Update May 18, 2020

Early Morning Update

The Jun20 natural gas contract is trading up $0.10 at $1.74.  The Jun20 crude oil contract is up $2.77 at $32.20.

Summary

As the new week begins, the eastern U.S. has been on quite of a late spring temperature rollercoaster. Last Saturday, snow was failing across part of the eastern U.S., and eight days later, those same cities hit summerlike temperatures. As we approach the Memorial Day holiday weekend, summer forecasts have been refined, and general consensus is building around a developing La Niña with an above-normal chance for a wet pattern setting up across the eastern U.S. Temperature predictions are in line with the 10YN (985 PWCDD vs. 971 PWCDD). As summer temperatures begin to show, the coronavirus continues to bring uncertainty to the market. With social distancing measures beginning to be relaxed around the country, how will historical summer load patterns change? Last year in PJM, the 5th coincident peak was 139.8 MW – could this now be the highest CP in PJM for the upcoming summer?  What if the virus returns during the summer - how will industrial and residential load be impacted? Many of these questions are yet to be answered, but be sure to be on the lookout for peak demand alerts from Direct Energy Business to be aware of potential peak days for all of the markets.

Market Update051820

Market Settles 051520

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