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Daily Market Update August 20, 2021

Early Morning Update

The Sep ‘21 natural gas contract is trading down $0.08 at $3.91. The Sep ‘21 crude oil contract is down $1.19 at $62.50.

Summary

The downward trend at the front of the NYMEX natural gas pricing curve continued yesterday, following a bearish storage report from the U.S. Energy Information Administration. The prompt month slipped another two cents to settle at $3.83/MMBtu, while Cals ‘22, ‘23, and ‘25 fell three, two, and one cent, respectively. Longer-term strips, Cals ‘25-’33, all moved up a penny. The EIA reported that natural gas storage stocks grew by 42 Bcf in the week to August 13, and inventories were bolstered further after the EIA reclassified 4 Bcf of base gas as working gas in the South Central nonsalt region. The 46 Bcf net change from the previous week far surpassed the 36 Bcf build that Bentek had projected in their Daily Storage Analytic Report, and was in line with the 45 Bcf addition seen last year for the same week, as well as the 42 Bcf five-year average. Total U.S. demand for natural gas is down 3.4 Bcf/d from yesterday, estimated at 91 Bcf/d today. Power burn (down 2.1 Bcf/d) and the res/comm sector (down 0.9 Bcf/d) were the biggest contributors to the day-over-day demand drop. Although production has been relatively stagnant at around 91 Bcf/d, demand is expected to drop another 3.0 Bcf/d this weekend, possibly contributing to more bearishness in the market.

 

Market Update 08 20 2021

Market Settles 08 19 2021

 

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