Bears Pushing Bulls Back Down

THE One Minute Energy Update for 2/22/24

#BearsBullyDownTheBulls

***#NYMEXDown #PG&EBasisDown #SoCalGasBasisDown #WeatherGood #CarbonOffsetsCheap!! ***

***NYMEX ****– NYMEX is back down again. *

***NYMEX pricing so far today - ****Open = $1.78, High = $1.78, Low = $1.66, Current = $1.67. NYMEX prices are down approximately $0.25 from 1 week ago and down approximately $0.40 from 1 year ago. *

NYMEX CALENDAR YEAR ESTIMATES* – 2024 = $2.40, 2025 = $3.38, 2026 = $3.73.*

*2023 NYMEX Monthly Final Settle average = $2.73. 2022 NYMEX Monthly average = $6.64. 2021 average = $3.84. *

*We are below the 50-day ($2.36), the 20-day ($1.91), and above the 9-day ($1.65) average. *

RESISTANCE* – Starting @ 1.81/$1.86. *

THE PIVOT* @ $1.74.*

SUPPORT* - Starting @ $1.70/$1.63. *

2023 NYMEX Monthly average = $2.73. 2022 NYMEX Monthly average = $6.64. 2021 NYMEX Monthly average = $3.84. We remain well below the last 3 year averages and are at a 40+ month low.

BASIS* – Both PG&E and SoCal Basis prices are down again today for day ahead pricing. Forward months are also down. We can begin picking off individual months. *

*The 2023 PG&E CG First of the Month Index averaged $9.83. The 2023 SoCal CG First of the Month Index averaged $10.95. The 2023 SoCal Border First of the Month Index averaged $8.14. *

EXPORTS & LNG EXPORTS* – LNG exports are averaging 13.08cf/D so far this week.*

PRODUCTION/SUPPLY & DEMAND* –**** ****Today’s Est. Supply = 109.8Bcf. Supply 7 Day Avg. = 110.72Bcf. Today’s Estimated Production = 103.7Bcf. ****Demand ****- Today’s Est. Demand = 111.6Bcf. Demand 7-Day Avg. = 124.28Bcf/D. Demand expected to be lower than normal. *

EIA just released the latest percentages for natural gas used for power generation, by region: California = 41%, Northwest = 23%, Southwest =45%, Texas (ERCOT) = 44%, SPP (Plains states) = 32%, MISO (south) = 44%, MISO (north) = 41%, Southeast = 44%, Florida = 73%, PJM = 46%, New York = 55%, New England = 48%. Despite what talking heads (and I’m not talking about the iconic band) and politicians might tell us, we continue to rely heavily on natural gas, and until we up our SMR and Hydrogen games, we will continue to rely on natural gas.

***RIG COUNT ****– Next rig count is 2-23-24. Currently, Oil sits at 497 active rigs. Natural gas sits at 121 active rigs. We are down 2 from 1 week ago and down 139 rigs from 1 year ago. *

WEATHER* – NG Weather has this to say for 2-22-24 – 2-27-24, “A warm break will set up over much of the US the next few days w/highs of 40s-50s across the northern US, and 50s-80s over the central and southern US. Weather systems will impact the West w/rain, snow, and mild to cool highs of 30s to 50s. A chilly weather system will track across the Midwest and Northeast this weekend w/lows of 10s to 20s for a minor bump in national demand but not strong w/the rest of the US mild-nice. Overall, Low demand Tue-Fri, moderate Sat, then back to light after.”*

6 – 10-day forecast = bearish. 10-15-day forecast = bearish. 3-month forecast = bearish. Summer forecast = bullish.

STORAGE* – The estimate was 65Bcf. The actual report shows a withdrawal of 60Bcf. We are now 265Bcf above last year at this time. We are 451 above the 5-yer average of 2,019Bcf. At 2,470Bcf, total working gas is above the 5-year average. for tomorrow’s storage report is a 65Bcf withdrawal. *

***CRUDE – ****Crude is running up so far based on geopolitical concerns and a weakening US dollar. Current price = $78.33. Forward estimates: 2024 = $75.62, 2025 = $70.84, 2026 = $67.38. *****

CA RETAIL POWER* – CAISO stays just above $37MWH. A hard fall from earlier this week.*

***CARBON OFFSETS – ***Many of our supply partners offer carbon offset with a vast menu to choose from if you are looking to shrink your carbon footprint. Feel free to contact us for more on carbon offsets whenever you like.

***THE BOTTOM LINE – ****A below estimate withdrawal, bearish weather, and continued strong production, despite threats from Chesapeake, have the current market bearish. The announcement did help Chesapeake’s stock price jump nearly 10 points in a day. Well played, Chesapeake Energy. Prices won’t stay down forever. Buy it while you can. *

**Indicative Fixed Prices out of March ’24 **

PG&E CG SOCAL CG SoCal Border (+ $0.51 BTS)

1 MONTH $3.35 $3.22 $2.90

3 MONTHS $3.28 $3.47 $4.04

6 MONTHS $3.50 $4.22 $3.81

12 MONTHS $4.57 $5.43 $5.10

24 MONTHS $4.96 $5.76 $5.42

Summer Strip (April ’24 – Aug ‘24)

$3.78 $4.59 $4.14