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Daily Market Update August 04, 2022

Early Morning Update

The Sep ‘22 natural gas contract is trading flat at $8.26. The Sep ‘22 crude oil contract is up $0.54 at $91.20.

Summary

The natural gas market had continued volatility, as the prompt month closed at $8.27/MMBtu, up $0.56 day-over-day. The sharp jump in prices occurred after news on the Freeport LNG facility confirmed that roughly 2.0 Bcf/d of LNG will start being delivered in early October. This upward price movement trickled into the outer calendar strips as the 12-month strip gained thirty-eight cents and the Cal’23 strip jumped twenty-five cents on the day. The Cal ’24 strip settled a dime higher, while the Cal ’25-Cal ’28 strips saw very little price movement, all closing out the trading day slightly higher. From a fundamental perspective, supply is largely unchanged, as production steadies near the 95.5 Bcf/d level. Demand fell almost 2.0 Bcf/d day-over-day, mostly due to power burn demand softening coming from the Northeast. Despite some demand relief, total demand is up almost 2.0 Bcf/d from a week ago. For the week ended July 29, Bentek is projecting a storage injection of 36 Bcf, which would be relatively in line with the five-year average and well above the injection for the same week last year. Temperatures in the Central U.S. to the Northeast will remain hotter-than-normal to close out this week. Those temperatures will subside in the Northeast, as the heat will shift to the West and Central regions for the remainder of August.

 

Market Update 08 04 2022

Market Settles 08 03 2022

 

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