NYMEX NatGas Starts This Week Moving Up
THE One Minute Energy Update for 8-19-24
Today’s highlights -
. Some CAISO LMPs (location marginal price) yesterday were priced at -$93MWh. Anyone still think we’re exaggerating when we talk about West coast volatility?
. Green energy struggles to provide 10% of all power generation in the US.
. In the meantime, more reliance is put on natgas, and for good reason. In many parts of the US (not you, CA/NY/MA), natgas is now cheaper than bottled water (after you adjust for inflation).
. NYMNEX NatGas is up so far this morning.
#NYMEX Open = $2.12, High = $2.19, Low = $2.09, Current = $2.18. Approximately -$0.05 from 1 week ago. Approximately -$0.60 from 1 year ago.
NYMEX CALENDAR YEAR ESTIMATES – 2024 = $2.54, 2025 = $3.22, 2026 = $3.54.
2024 NYMEX Monthly Average (through Aug ‘24) = $2.11.
2023 NYMEX Monthly average = $2.73.
2022 NYMEX Monthly average = $6.64.
2021 NYMEX Monthly average = $3.84.
We are below the 50-day ($2.36), but above the 20-day ($2.08) and the 9-day ($2.15) average.
#RESISTANCE – Starting @ $2.18/$2.25.
#PIVOT @ $2.15.
#SUPPORT - Starting @ $2.08/$2.04.
#BASIS – #PG&ECGBasis and #SoCalCGBasis weakening. Both should fall further in the coming weeks IF renewables can step up for any length of time.
#NYNMEX + BASIS INDEX PRICING
The 2024 PG&E CG First of the Month Index avg = $3.34 through Aug ’24. 2023 avg = $9.83.
The 2024 SoCal CG First of the Month Index avg = $3.05 through Aug ’24. 2023 avg = $10.95.
The 2024 SoCal Bdr First of the Month Index avg = $2.51 through Aug ’24. 2023 avg = $8.14.
#LNG EXPORTS = 12.6Bcf. LNG Export volume expected to increase in 2025 due to higher demand and new terminals opening.
#MEXICO EXPORTS = 7.0Bcf. In 2025 and beyond, expect more natgas going to Mexico for Mexican LNG export facilities, increased power generation, and to meet the ever-growing C&I natgas demand.
#CANADIAN IMPORTS = 6.5Bcf
#SUPPLY - Today’s = 107.9Bcf. 7 Day Avg. = 107.1Bcf.
#PRODUCTION - Today’s Est. = 101.7Bcf.
#DEMAND - Today’s Est.= 101.9Bcf. Latest 7 Day Avg. = 100.3Bcf.
#RIGCOUNT – Last week’s rig count (8-16-24) = Oil - 2 to 483 rigs, NatGas = + 1to 98 rigs, miscellaneous – 1 to rigs. Total @ 586. Last year this time @ 642.
#STORAGE – We are currently 209Bcf higher than this time last year and 375Bcf above the 5-year average of 2,889Bcf. At 3,264Bcf, total working gas is within the 5-year historical range. The latest Storage projections for Oct ’24 range between 3.87Tcf – 4.03Tcf. The March ’25 estimate is 1.63Tcf – 1.95Tcf.
#CRUDE – Down. Current Cash price = $75.86. Forward estimates: 2024 = $75.21, 2025 = $71.63, 2026 = $68.49.
#CAISO and #CALIFORNIARETAILPOWER – Grid Status = Normal. CAISO current pricing = $23 - $37.
#CALIFORNIAPOWERGENERATION = NatGas @ 42.3%, RE @ 15.4% (Solar -1.4%, Wind 59.1%), Hydro @ 9.8%, Imports (a lot of which is coal generated power) @ 23.0%, Nuclear @ 9.6%.
#HURRICANE SEASON UPDATE – Ernesto is moving through the north Atlantic but not without leaving severe rainfall and flooding throughout the Northeast.
#WEATHER –Extreme heat in the SW and Texas today. High temps in the Badlands and Gulf states. Heavy rain/flooding in parts of the Northeast. The rest of the US should enjoy cooler temperatures for the next few days.
Today = Bearish. 5 – 10-day forecast = Bearish. 10-15-day forecast = Bearish. Aug – Oct forecast = Bearish. Oct – Dec forecast = Bearish. Winter Forecast (Dec ’24 – Feb ’25) = Bearish.
#CARBONOFFSETS – California and other states will be mandating companies buy carbon offsets, starting as early as 2025. Is your company ready for that mandate? Better to get ahead of the 2025 demand – more options, greater price range. We can help.
THE BOTTOM LINE – NatGas inventories are 13% above the 5-year avg as of last week. Some might look at that as bearish. As demand grows for natgas because other energy sources fail to produce (as seen in CAISO’s latest supply numbers above), coupled with an unknown winter coming, 13% over the 5-yr avg is nothing. Opportunities still exist, and will exist, but they will be fewer and harder to find.
RFP ES is now providing energy in WA, OR, CA, NV, AR, NM, (parts of) TX, PJM region, Mid-Con region, Gulf States region, NC, and VA.
ALSO – If you would like an indicative/executable quote, you can simply go to RFPES.com and submit a Request for Proposal (RFP). It couldn’t be easier. We’re always here to discuss the best options in an ever-changing market.