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Daily Market Update November 23, 2020

Early Morning Update

The Dec20 natural gas contract is trading up $0.04 at $2.69. The Dec20 crude oil contract is up $0.38 at $42.80.

Summary

On Friday, the December 2020 NYMEX natural gas futures price climbed 5.8 cents on the day to settle at $2.650/MMBtu. Down almost 24 cents week-over-week, the prompt month had experienced a sharp selloff that seemed to be driven mostly by weather and steady production. Winter weather forecasts have warmed slightly since their original outlook in October. While there had been some concerns in the market of a cooler December jumpstarting early heating demand, freezing winter weather now appears more likely in Jan/Feb ‘21. Forecasts show warmer-than-normal temps blanketing the majority of the eastern half the country, which is typically a major natural gas demand center during the winter. LNG exports remain high, averaging just over 10.5 Bcf/d. U.S. dry production is averaging just under 89.0 Bcf/d so far this month, and had been climbing over 91.0 Bcf/d this past week. The uptick in supply, coupled with the warmer temperatures, have had a bearish effect on pricing. If the warm weather continues, we could see the bearishness extend farther out the NYMEX pricing curve.

 

Market Update 11 23 20

Market Settles 11 20 20

 

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