Has NYMEX hit bottom??

THE One Minute Energy Update for 3-6-24

Has NYMEX hit bottom??

***#NYMEXInchingHigher #PG&EBasisUp #SoCalGasBasisUp #WeatherShifting #CarbonOffsetsBecomingMoreRelevant ***

***NYMEX ****– NYMEX prices are holding firm, gaining support from production cuts. *

***NYMEX pricing so far today - ****Open = $1.95, High = $1.95, Low = $1.98, Current = $1.92. NYMEX prices are up approximately $0.05 from 1 week ago and down approximately $1.00. from 1 year ago. *

NYMEX CALENDAR YEAR ESTIMATES* – 2024 = $2.61, 2025 = $3.51, 2026 = $3.80.*

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 at a 40+ month low.

*We are below the 50-day ($2.24), and above the 20-day ($1.74) and the 9-day ($1.80) average. *

RESISTANCE* – Starting @ $2.01/$2.07. *

THE PIVOT* @ $1.95.*

SUPPORT* - Starting @ $1.86/$1.83. *

BASIS* – Both PG&E and SoCal Basis prices are up slightly today. Waiting for the weather to shift back to normal. *

*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. We remain WELL BELOW the last 3-year averages. *

***LNG ****– The Biden LNG Exports pause continues. *

PRODUCTION/SUPPLY & DEMAND* – Production is down 3% so far in March ’24. ******Today’s Est. Supply = 106.0Bcf/D. Supply 7 Day Avg. = 107.37Bcf. Today’s Estimated Production = 101.9Bcf/D. Latest Demand 7 Day Avg. = 108.64Bcf/D. Demand is expected to remain very low. *

***RIG COUNT ***– As of 3-1-24 – Second straight week of an overall rig count increase. Oil rose by 3 for a total of 506 active rigs, down 86 from 1 year ago. Natural gas fell by 1 for a total of 119 active rigs, down 35 rigs from 1 year ago. In the graph below, all that Permian production is good news for the Western region.

WEATHER* – Not much change from yesterday. This west coast storm is taking its time to leave, keeping demand elevated. We’re looking at bearish conditions by the weekend. 5 – 10-day* forecast = bearish. 10-15-day forecast = bearish. 3-month forecast = bearish. Summer forecast = bullish.

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STORAGE* – The next storage report comes out tomorrow and is expected to show a withdrawal of 41Bcf. Compare that to 72Bcf last year this time, and the 5-year average of 93Bcf. *

*CRUDE – C**urrent price = $80.31. Forward estimates: 2024 = $75.63, 2025 = $70.76, 2026 = $67.41. *****

CA RETAIL POWER* – CAISO stays just above $36MWH.*

RENEWABLE ENERGY* – The Solar kids are thumping their chests this morning as reports come out that solar provided (the bulk) 32GW of new power generation capacity in 2023 here in the US. *

***CARBON OFFSETS – ***We’re going to see a lot of carbon offsets coming out of Africa as their government finally gets serious about implementing “clean cooking” mandates/projects. If you’re looking to buy carbon offsets, our menu of carbon offsets continues to grow as we add more and more supply partners. Most companies will be mandated to curb their carbon footprint. SOME carbon offsets may be the easiest, cheapest, and most effective way to do so.

***THE BOTTOM LINE – ***We’ve just experienced record production, lowest prices in 30 years (with an inflation adjustment in place), a very mild winter, below normal demand. That’s bearish. We are now about to see production cuts by at least 2.5Bcf/D, summer heat will be here soon, LNG demand is increasing, exports to Mexico are increasing, demand for natural gas sourced power generation continues to rise, and we’re heading towards pipeline maintenance season. That’s all bullish and it’s coming. We have the current shoulder season to take advantage of the bears before the bulls come charging. We should see our best buying opportunities over the next few weeks.

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

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

1 MONTH $3.15 $3.45 $3.06

3 MONTHS $3.20 $3.65 $3.27

6 MONTHS $3.67 $4.53 $4.22

12 MONTHS $4.68 $5.51 $5.18

24 MONTHS $5.04 $5.80 $5.51

Summer Strip (April ’24 – Aug ‘24)

$3.54 $4.37 $3.93

Winter Strip (Nov ’24 – Feb ’25)

$6.37 $7.42 $7.01