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Daily Market Update November 24, 2020

Early Morning Update

The Dec20 natural gas contract is trading up $0.05 at $2.76. The Jan21 crude oil contract is up $0.79 at $43.85.

Summary

Monday saw an increase in natural gas prompt month pricing, gaining six cents to settle at $2.711/MMBtu, and is currently trading slightly further up this morning. With the prompt month coming off of a weeklong selloff, prices are currently far from their highs, with little time to make up for it since expiration is tomorrow, November, 25th. Price movement is going to be heavily impacted by weather forecasts, and the majority of the North American markets are appearing to be above-normal, if not at normal temperatures, in the 20-day outlook, indicating a bearish outlook for the near-term. When it comes to production, there are further concerns that producers will not be able to keep up at the current high levels. Current production levels are rivaling the April levels right before the summer selloff and following production crash due to COVID. The concern around the market is that prices appear to be weaker through the winter and most of 2021 than previously expected. If price do not increase, producers will find it difficult to keep up with production through the next year, posing a major threat to potential storage by next year's end and future natural gas pricing.

 

Market Update 11 24 20

Market Settles 11 23 20

 

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