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Daily Market Update May 27, 2020

Early Morning Update

The Jun20 natural gas contract is trading down $0.03 at $1.76.  The Jul20 crude oil contract is down $0.45 at $33.90. 

Summary

Yesterday’s trading session kicked off the shortened week with upward movement for the near-term, as the prompt month gained just over six cents from Friday to close at $1.793/MMBtu. The balance of 2020 moved up 5.2 cents to $2.18, and the 12-month strip gained 3.9 cents to close at $2.42. The forward calendar strips remain backwardated through 2028, with 2021 being the only strip that moved up yesterday, gaining 1.3 cents to close at $2.667. Calendar strips 2023 through 2028 are all trading very closely to one another, with the spread across the six years being just four cents. There was broad downward movement beyond 2022 through the end of the curve, with the largest drop far out in 2029-2031 shifting down three cents. Demand is moving up today, led by the Power Burn sector, as warm south central temperatures are driving up cooling demand. LNG exports have also moved up almost 1.0 Bcf/d from over the weekend, but are still down nearly 3.0 Bcf/d from their recent high set back in the winter.

Market Update052720

Market Settles 052620

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