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Daily Market Update February 01, 2022

Early Morning Update

The Mar ‘22 natural gas contract is trading down $0.16 at $4.71.  The Mar ‘22 crude oil contract is down $0.45 at $87.70.

Summary

As much of the Northeast continues to dig out from this weekend’s blizzard, mother nature isn’t letting up, with the next winter storm coming into focus affecting 90 million people from Texas to the Atlantic Canada. The storm gets started tonight in the plains states with snow and ice as far south as Dallas by Wednesday night. It then moves up the Ohio Valley and into the Northeast by Friday with a large mix of snow, ice, and rain. Behind the front, arctic air envelops much of the central plains, with temperatures dipping in Dallas to the mid-10s and mid-20s in Houston, but look to recover to normal by Monday. With the potential for increased demand on the ERCOT grid, please be on the lookout for index price spikes. On the fundamentals front, the below-normal temperatures that dominated most of the U.S. in January have shifted the end of winter (EOW) storage outlook.Total natural gas demand with exports for January averaged ~127 Bcf/day – above the 5YA by 14%. At the end of 2021, consensus for EOW storage levels were 1.6 Tcf, but now projections are down to 1.3 Tcf.This changing outlook could be one the reasons for the recent run-up in NYMEX prices for the balance of 2022 and Cal ‘23 strips.

 

Market Update 02 01 2022

Market Settles 01 31 2022

 

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