Daily Market Update October 17, 2022
Early Morning Update
The Nov ‘22 natural gas contract is trading down $0.38 at $6.07. The Nov ‘22 crude oil contract is up $0.49 at $86.10.
Summary
ast week, the prompt month saw little change in a week-over-week perspective. The October natural gas contract opened on Monday and closed on Friday at the same price. Also, over the weekend, production saw a 3.0 Bcf/d drop after we hit a weekly high of 97.7 bcf/d on Tuesday. The decrease in production was due to some processing plants going offline. However, over the weekend, that number bounced back up to over the 97 Bcf/d mark since the facilities came back on line. From a demand view, power burn is still the main driving factor, although its rate has fallen below 30 Bcf/d and has consistently been at 29 Bcf/d for the past four days. Res/comm demand has increased from 17 Bcf/d last week to almost 24 Bcf/d this week. This is due to temperatures in the eastern U.S. seeing colder-than-normal temperatures in October. As temperatures continue to decrease as we move closer to winter, res/comm demand will continue to rise and become the main driving factor for natural gas demand. Exports also saw an increase back up to 11.5 Bcf/d and are expected to get back up to 12 Bcf/d this week as Cove Point is finishing up on maintenance work.
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