It's the time of the Season....to be buying
THE One Minute Energy Update for 3-19-24
***#NYMEXUp #PG&EBasisDown #SoCalGasBasisDown #WeatherSplit #YouWillNeedCarbonOffsetsBeforeYouKnowIt ***
***NYMEX pricing so far today - ****Open = $1.71, High = $1.76, Low = $1.70, Current = $1.75 – up $0.06 from Friday’s close. NYMEX prices are flat from 1 week ago and down approximately $0.60 from 1 year ago. *
NYMEX CALENDAR YEAR ESTIMATES* – 2024 = $2.46, 2025 = $3.47, 2026 = $3.80.*
*2023 NYMEX Monthly average = $2.73. 2022 NYMEX Monthly average = $6.64. 2021 NYMEX Monthly average = $3.84. *
*We are below the 50-day ($2.07), the 20-day ($1.76) and tied with the 9-day ($1.73) average. *
RESISTANCE* – Starting @ $1.74/$1.79. *
THE PIVOT* @ $1.74. *
SUPPORT* - Starting @ $1.67/$1.63. *
BASIS* – Both PG&E and SoCal Basis prices are down ever so slightly. We can expect an upward movement by early next week with below normal temperatures rolling in across TX, SW, CA, Pac NW, and Rockies. *We are in the buying range NOW.
*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 EXPORTS, NG EXPORTS, NG IMPORTS ***– Freeport close to restarting. LNG demand averaging 13.3Bcf/D. Mexico exports averaging 6.3Bcf/D. Canadian imports averaging 4.0Bcf/D.
PRODUCTION/SUPPLY & DEMAND* – Today’s Est. Supply = 105.4Bcf/D. Supply 7 Day Avg. = 105.7Bcf. Today’s Estimated Production = 99.6Bcf/D. Today’s expected demand = 113.6Bcf – highest demand in over a week. Latest Demand 7 Day Avg. = 103.17Bcf/D. Of the past 7 days, 4 of those days supply has outweighed demand. Demand increases to moderate this week. *
***RIG COUNT ***– As of 3-15-24 - Oil added 6 rigs for a total of 510 active rigs. Gas added 1 rig for a total of 116 active rigs.
WEATHER* – NatGasWeather.com has this to say for the next 6 days, “Weather systems will track across the northern US w/highs of 20s to 50s, along w/areas of rain and snow. The southern US will be mild to nice w/highs of upper 50s to 80s and areas of showers. Overall, moderate demand for the next 7-days”. 5 – 10-day forecast = bullish. 10-15-day forecast = bullish. 3-month forecast = bearish. Summer forecast = bullish. *
STORAGE* – We are 336Bcf above this time last year and 629Bcf above the 5-year average of 1,696Bcf. At 2,325Bcf, we are above the 5-year historical range.*
***CRUDE – ****Current price = $83.27. Forward estimates: 2024 = $80.29, 2025 = $73.38, 2026 = $69.69. *****
CA RETAIL POWER* – CAISO just over $29 per MWH. *
RENEWABLE ENERGY* – One major problem that continues to be ignored by those pushing to get rid of natural gas and replace it with renewable energy is the strain that will be put on our outdated and poorly managed electric grids throughout the US. Locally, the increasing number of EVs here in California is already a concern for those who are paying attention to the big picture. *
***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 – ***Remember Subway had $5 Footlongs just 3 years ago? Now a footlong sub is nearly double that price. That’s how much inflation has jumped on us. But here we have natural gas often costing less than in the past 3 years. And you’re still waiting to lock in forward fixed prices that beat the 3-year average? Ok…..
**Indicative Fixed Prices out of April ’24 **
PG&E CG SOCAL CG SoCal Border (+ $0.51 BTS)
1 MONTH $2.90 $2.72 $2.44
3 MONTHS $2.91 $2.90 $2.56
6 MONTHS $3.40 $3.92 $3.56
12 MONTHS $4.55 $5.15 $4.88
24 MONTHS $4.95 $5.60 $5.18
Summer Strip (April ’24 – Aug ‘24)
$3.30 $3.74 $3.36
Winter Strip (Nov ’24 – Feb ’25)
$6.40 $7.40 $7.02