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Daily Market Update September 8, 2020

Early Morning Update

The Oct20 natural gas contract is trading down $0.05 at $2.54.  The Oct20 crude oil contract is down $2.22 at $37.55.

Summary

The Oct ‘20 NYMEX natural gas contract rallied ten cents on Friday, closing out the week at $2.588/MMBtu. The Nov ‘20 contract rose six cents, but the rally ended there, as 2021-2025 calendar strips were all up less than a penny. The market remains backwardated through 2024. This comes on the heels of a storage injection, which despite being lower than historic averages, came in very close to what market analysts had expected. As well, natural gas production was up 0.5 Bcf/d on Friday, reaching 88 Bcf/d over the weekend, and total U.S. demand had dropped 1.7 Bcf/d day-over-day. Power burns have been drifting downward, as cooler temperatures envelop most of the country outside of the West Coast and the Southeast. Electric customers across California were being asked to conserve power over the holiday weekend to avoid a repeat of the rolling blackouts that were seen on August 14 and 15 during the heat wave that is currently wreaking havoc out west. No system outages were expected over the weekend, in large part due to lower overall demand over the holiday weekend.

Market Update090820

Market Settles 090420

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