Daily Market Update September 10, 2021
Early Morning Update
The Oct ‘21 natural gas contract is trading up $0.02 at $5.05. The Oct ‘21 crude oil contract is up $1.34 at $69.48.
Summary
Though the market on this short week opened with a significant bearish move on Monday, prices have continued onwards and upwards to reach levels that a prompt month has not settled at since February 25, 2014. The October 2021 contract settled at $5.031/MMBtu, a staggering $2.15/MMBtu higher than where it traded last year on this date. Prices at this level are most definitely concerning to the market, and though many fundamental factors have been covering the reasons in an attempt to explain it, the early 35 cent move for the prompt on Wednesday is a very particular. The patterns of the movement during intraday trading indicated potential for algorithmic trades pushing for a higher market. Concern for winter has not dwindled as further movement for the prompt month in international markets have continued their own climbs. The European market is valuing LNG's around $19.467/MMBtu dollars, while the JKM marker in eastern Asia is valued at $18.65/MMBtu. The JKM marker maxes out their current forwards at the jaw dropping level of $22.52/MMBtu for the February contract. The extreme value is more than enough to pay for American natural gas to be exported.
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