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Daily Market Update March 26, 2021

Early Morning Update

The Apr21 natural gas contract is trading down $0.01 at $2.56. The May21 crude oil contract is up $1.33 at $59.89.

Summary

Prices have been ticking up slightly to settle at $2.57/MMBtu on the NYMEX natural gas front as we approach the last few trading days for the April contract. The tick up very well could be technical movement as fundamentals such as storage, production, and demand have remained weak throughout the last week or so. There are some global concerns about the LNG supply-chain as the Suez Canal, which is being blocked by another container ship, is one of the main routes for LNG cargoes going from the Middle East to Europe along with some Mediterranean shipments to Asia. With estimations extending into the weeks for the blockage to clear, foreign producers are at a massive disadvantage in the market, and offers an opportunity for U.S. producers to secure orders. The typical trip would be approximately 17 days, but rerouting will increase the timing to about a month of transportation time, and expenses incurred will increase global benchmarks for all commodities. Following already recent highs that come in at 11.9Bcf/d, we could see even further demand increase the April contract right before expiration date.

 

Market Update 03 26 2021

Market Settles 03 25 2021

 

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