Daily Market Update November 12, 2021
Early Morning Update
he Dec ‘21 natural gas contract is trading down $0.10 at $5.04. The Dec ‘21 crude oil contract is down $1.00 at $80.59.
Summary
he market jumped yesterday and ended the day higher by $0.269 to close the day at $5.149. Some weather models were updated yesterday afternoon to show colder temps moving into the east coast for much of the next 20 days. Even though NG production has ticked higher recently, up to 94 Bcf/d, the market remains highly weather sensitive. The prospect of a low-storage outcome at the end of winter due to a cold winter remains of significant concern and the market reacts swiftly to any colder changes to the weather forecasts. NG storage is relatively healthy, but a low storage outcome is still possible if cold temps materialize. Power index prices remain elevated and volatile. High demand from gas-fired power generation while gas prices are high virtually guarantees higher power prices, and we’ve been seeing that.
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