Pipeline Maintenance Season Is Coming!

THE One Minute Energy Update for 4-11-24

***#NearingMaintenanceSeason ***

***#NYMEXDown #PG&EBasisDown #SoCalBasisDown #WeatherShifting #CarbonOffsetsSoldHere ***

***NYMEX Pricing So Far Today - ****Open = $1.87, High = $1.89, Low = $1.78, Current = $1.78. NYMEX prices are down approximately $0.05 from 1 week ago and down approximately $0.35 from 1 year ago. *

NYMEX CALENDAR YEAR ESTIMATES* – 2024 = $2.53, 2025 = $3.47, 2026 = $3.83.*

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

*We are below the 50-day ($1.79), above the 20-day ($1.75) and below the 9-day ($1.83) average. *

RESISTANCE* – Starting @ $1.89/$1.92. *

THE PIVOT* @ $1.82. *

SUPPORT* - Starting @ $1.79/$1.71. *

BASIS* – PG&E Basis prices are down. SoCal Basis falls further. *

*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. *

***LNG EXPORTS, NG EXPORTS, NG IMPORTS ****– LNG exports averaging 12.5Bcf.D. Exports to Mexico = 5.8Bcf/D. Imports from Canada = 4.8Bcf. *

PRODUCTION/SUPPLY & DEMAND* – Today’s Est. Supply = 104.4Bcf. Supply 7 Day Avg. = 106.5Bcf. Today’s Est. Production = 100.8Bcf. *

*Today’s Est. Demand = 97.1Bcf. Latest Demand 7 Day Avg. = 102.34Bcf. 7-day Demand forecast is low. *

***RIG COUNT ****– The next rig count comes out tomorrow. Currently, the oil rig count stands at 508 active rigs. Active natural gas rigs stand at 110 active rigs. *

STORAGE* – Today’s Storage Report shows an injection of 24Bcf. We are now 435Bcf above this time last year and 633Bcf above the 5-year average of 1,650Bcf. At 2,283Bcf, we are above the 5-year historical range. *

WEATHER* – NatGasWeather.com has this to say for the next 6 days, “An active weather pattern continues into the weekend as numerous weather systems track across the US w/showers and thunderstorms, including heavy rains over portions of the Southeast today, and a strong system into the rest of the East the next few days. Although, overall, temperatures will be mild over the northern US w/highs 50s to near 70F, while very nice to warm over the southern US w/highs of 60s-80s, locally 90s. Light to very light demand the next 7-days.”*

*5 – 10-day forecast = bearish. 10-15-day forecast = bearish. 3-month forecast = bearish. Summer (June – Aug) forecast = bullish. *

CRUDE –* Falling. Current price = $85.43. That’s’ up $2 from yesterday’s opening price. Forward estimates: 2024 = $82.41, 2025 = $75.51, 2026 = $70.49. *****

CA RETAIL POWER* – CAISO just over $30 per MWH. *

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, many of our Supply Partners offer carbon offset menus (type of carbon offset, price per unit, etc.) for review and purchase.*

RENEWABLE ENERGY* – Renewable Energy funds are seeing a lot of money leave in recent months. The two main reasons – political uncertainty and consumers no longer having the freedom to spend blindly on higher priced RE due to crippling inflation. At the end of the day, people have to survive and will go with reliable, cost-effective energy sources. *

***THE BOTTOM LINE ****– The driving factors/fundamentals remain bearish in the short term. However, here are a few driving factors that show up every summer, bringing the bulls with them; heatwaves driving cooling demand days above normal, pipeline maintenance, and with limited pipeline optionality in the West, we are exposed to potential transportation (basis) price spikes. Keep these in mind when you find yourself chasing (what you believe is) the bottom of the market. *

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

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

1 MONTH $2.60 $2.50 $2.25

3 MONTHS $3.00 $3.40 $3.05

6 MONTHS $3.45 $4.15 $3.80

12 MONTHS $4.65 $5.30 $4.67

24 MONTHS $5.09 $5.77 $5.35

Summer Strip (April ’24 – Aug ‘24)

$3.40 $4.11 $3.60

Winter Strip (Nov ’24 – Feb ’25)

$6.40 $7.19 $6.77