Daily Market Update September 28, 2022
Early Morning Update
The Oct ‘22 natural gas contract is trading down $0.08 at $6.57. The Nov ‘22 crude oil contract is up $1.10 at $79.60.
Summary
Yesterday’s natural gas trading session continued the recent trend of pricing sliding lower at open and staying down through the day. The October prompt month contract lead the way as it lost a quarter and closed at $6.651/MMBtu, and the winter strip of Nov ‘22-Mar ‘23 followed closely behind, dropping 22 cents. The 12-month strip shifted down by 14 cents, while the prompt calendar strip for 2023 fell just under ten cents to $5.43. The market largely remained flat from 2024 to 2026, but Cals 2027 through 2034 fell between seven and 25 cents, with the larger drops occurring beyond 2030. The low strip remains 2027 at $4.385. October will also expire today, bringing the front of the winter stirp into the prompt month spot as temperature forecasts continue to show above-average temperatures through the front half of October. Domestic natural gas production has remained around the 96.5 Bcf/d mark for much of the week, while demand has fallen over the week with the bulk of the drop coming out of the power burn demand sector as A/C demand declines. However, the slide in demand has been curbed slightly by the uptick in the residential and commercial sector. This is no surprise as the Midcon and Northeast regions are experiencing autumn-like temperatures.
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