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Daily Market Update April 20, 2021

Early Morning Update

The May ‘21 natural gas contract is trading down $0.02 at $2.73. The May ‘21 crude oil contract is up $0.22 at $63.60.

Summary

Bulls dominate the market for both gas and power across the country. Fundamental indicators such as weather forecasts, storage, and production are all pushing natural gas prices higher, while technical factors confirm the market sentiment. Weather-wise, we do see cold for this week and next for the midcon and eastern markets, which has pushed demand up for the U.S. as a whole. Even with the demand increase, we have seen a decrease in production while producers go into seasonal maintenance, bringing the production levels from around 93 Bcf/d down to 90 Bcf/d. When looking at storage, the next three injections are projected to be lower than average. If these forecasts hold, the market will see national storage levels fall below the 5-year average. With demand remaining above the 5-year average, the market would be straining to find the supply for winter, putting pressure on both short and long terms gas prices. Adding to the overall upward movement is the recent release of market-wide summer weather outlooks. Like last year, forecasts call for a hot summer with strong drought conditions for nearly the entire western half of the U.S., including Texas.

 

Market Update 04 20 2021

Market Settles 04 19 2021

 

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