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Daily Market Update July 01, 2022

Early Morning Update

The Aug ‘22 natural gas contract is trading up $0.43 at $5.85.  The Aug ‘22 crude oil contract is up $2.24 at $108.00.

Summary

Within the last three days, the NYMEX natural gas prompt month traded as high as $6.833/MMBtu. It settled yesterday at $5.424/MMBtu. So what happened? As usual, the supply/demand balance played a large part as this week brought relatively higher production, less demand due to Freeport LNG being down, and a strong injection report. The U.S. Energy Information Administration reported an 82 Bcf injection, coming in about 3 Bcf higher than market estimates. This bearish information is likely the catalyst that pushed the prompt price lower, but the impacts on storage had longer-term impacts, as well. The 12-mo strip tumbled $0.85, Cal ‘23 dropped $0.54, and all of the calendar strips from 2024 through 2034 lost a quarter. Natural gas stockpiles now stand at 2,251 Bcf, 322 Bcf (12.5%) less than the 5-year average. End-of-season estimates increased slightly to 3,520 Bcf. If your company is looking to hedge with the recent market drop, please consider that this weekend is going to be a holiday weekend. Our gas commodity desk will be closed early today at 2:30pm, one hour earlier than usual, and the business will be closed all day on Monday to celebrate Independence Day. Our team hopes you and your loved ones have a fun and safe holiday!

 

Market Update 07 01 2022

Market Settles 06 30 2022

 

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