Daily Market Update July 27, 2022
Early Morning Update
The Aug ‘22 natural gas contract is trading down $0.24 at $8.75. The Sep ‘22 crude oil contract is up $1.01 at $95.99.
Summary
2022 continues to surprise, as the prompt month crept once again toward the $10 technical trading level yesterday. Today marks the final day of trading for August 2022 as prompt month. Yesterday, the NYMEX prompt month for August rose 26.6 cents on the day to settle at $8.993/MMBtu. As has been the trend for the past few days the prompt month saw a large trading range between $8.750-$9.752/MMBtu. Welcomed mild temperatures have moved into the forecasts for the majority of the Eastern half of the country over the next week, before once again being blanketed by much warmer than normal temperatures. If August weather comes in anything like the past two months, the system will once again be tested with peaking demand, specifically in the Powerburn sector this summer. U.S. dry production has averaged right around 95 Bcf/d, still hovering below pre-pandemic levels during this period of record setting demand. Tomorrow the EIA is expected to report around a 25 Bcf build into storage, due to the peaking heat seen across the county last week. This would be lower than the five year average benchmark of 32 Bcf for the same week, continuing to widen the deficit to inventory levels adding to the concern for this upcoming winter.
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