Daily Market Update September 03, 2021
Early Morning Update
The Oct ‘21 natural gas contract is trading up $0.05 at $4.69. The Oct ‘21 crude oil contract is up $0.45 at $70.44.
Summary
We here at Direct Energy Business hope you all have a fun and safe Labor Day weekend. Our team will not post a Morning Market Update this upcoming Monday in observance of the federal holiday. Since last Thursday, the NYMEX natural gas prompt has seen some extreme bullish movement. Last Thursday, the October 2021 strip opened trading at $3.925/MMBtu. We closed this Thursday's trade at a whopping $4.641/MMBtu for a record $0.716/MMBtu increase week over week. This trade history, beats every other weekly price movement when looking back since the first week this contract traded in November of 2013. Volatility has been said to have been caused by further storage concerns, global marker runups, and hurricane Ida. As for storage, the EIA reported yet another dismal 20Bcf injection, achieving only a measly 38% of the 5-year average at 53Bcf. This storage concern is not unique to the continental US though. The Asian market has been showing further concern for their own winter storage. As a result, the JKM marker has reached over $20/MMBtu for the December-February strip. Hurricane Ida temporarily slowed many of our exports out of the Gulf, but activity is already showing signs of a return, as most of the flooding and damage missed much of the natural gas sector infrastructure in Texas.
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