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Daily Market Update March 18, 2021

Early Morning Update

The Apr21 natural gas contract is trading down $0.03 at $2.50. The Apr21 crude oil contract is down $0.80 at $63.80.

Summary

Yesterday saw a reversal in the prompt month contract from the previous day's gains, as Apr '21 shed a little over three cents and closed out at $2.528/MMBtu. That weakness carried over into the 12-month strip and Cal '22, with both losing three cents, as well. Levels this low for the prompt month haven't been seen since January, which could be the result of a very bearish shift in the weather, especially after the winter storm that ensued in mid-February. Warmer-than-normal temperatures are forecast for much of the Northeast and MidCon through the end of March, which should ease natural gas demand for heating. These warmer temperatures have also resulted in smaller withdrawals from natural gas storage. Now that we're currently trending at a deficit to last year and the 5-year average, smaller withdrawals may prove to be another bearish signal to the market. Market participants are expecting an 18 Bcf withdrawal to be reported today, which would be 41 Bcf smaller than the 5-year average. With just two more withdrawals on tap before we flip to injections, the end-of-season storage level is now projected to be 1,735 Bcf.

 

Market Update 03 18 2021

Market Settles 03 17 2021

 

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