Daily Market Update October 03, 2022
Early Morning Update
The Nov ‘22 natural gas contract is trading down $0.34 at $6.43. The Nov ‘22 crude oil contract is up $3.61 at $83.10.
Summary
Last week, near-term natural gas prices trended down, and the October prompt month closed at $6.766. In the days leading up to the prompt month closing, the near-term volatility was not as heavy as it has been in previous weeks, only changing by a total of $0.30 throughout the week. Over the weekend, production hit new highs by finally topping the 97 Bcf/d mark, currently sitting at 97.3 Bcf/d. Demand also increased over the weekend, mainly due to an increase in res/comm demand, which is currently at 16.7 Bcf/d. As temperatures dropped in the eastern side of the U.S., power burn demand, which was the main driving factor for demand over the summer, decreased, but this was offset by res/comm demand, which started to increase. The res/comm demand slowly increased over the last week and will continue to as we get closer to the winter season. As Hurricane Ian has hit the southern U.S., gas exports did see a small decrease as well. Last week, exports were at a rate of 12.5 Bcf/d, but, over the weekend, they fell to around 11 Bcf/d. The weather for the upcoming week is going to be similar to last week. The eastern half of the U.S. will see colder-than-normal temperatures, while the Midwest and West are forecast to be higher than normal.
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