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Daily Market Update March 23, 2021

Early Morning Update

The Apr21 natural gas contract is trading down $0.03 at $2.55. The Apr21 crude oil contract is down $2.46 at $59.10.


The fundamentals of the energy and gas markets are beginning to show a completely different story from where we were last month. We have seen over a $0.50/MMBtu decrease in the April NYMEX natural gas contract's price as a result. This has come as temperatures begin to show a shift from winter to spring weather, and concern over storage for next year begins to dwindle. Earlier on in the winter, market predictions called for a storage level below 1,300 Bcf, which would put the market in a very precarious condition for next withdrawal season. As it stands today, forecasts are actually showing a return to a year-over-year surplus within the next four weeks, whereas we have been in a deficit for some time. This change in outlook has even convinced the managed money sector to flip, for the first time since last June, to a net short position. As we move to increasingly warmer temperatures heading into summer, demand for power is expected to increase. This usually means higher index prices. Forward power pricing is highly influenced by the natural gas market due to the reliance on natural gas for power burn, but trends in index pricing can eventually influence forward prices.


Market Update 03 23 2021

Market Settles 03 22 2021


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