Shoulder Season Should Start Soon.
THE One Minute Energy Update for 3-1-24
#ShoulderSeasonShouldStartSoon. Say it 5 times.
#NYMEXMovingDownSlowly #PG&EBasisFlat #SoCalGasBasisDown #WeatherGood #CarbonOffsetsCheap!! #CrudeOver$80
***NYMEX ****– NYMEX is resting comfortably after dropping in price most of this trade week. *
***NYMEX pricing so far today - ****Open = $1.85, High = $1.88, Low = $1.81, Current = $1.84. NYMEX prices are up approximately $0.10 from 1 week ago and down approximately $0.90 from 1 year ago. *
NYMEX CALENDAR YEAR ESTIMATES* – 2024 = $2.54, 2025 = $3.46, 2026 = $3.78.*
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 ($2.28), and above the 20-day ($1.76) and the 9-day ($1.73) average. *
RESISTANCE* – Starting @ 1.90/$1.95. *
THE PIVOT* @ $1.86. We are currently below.*
SUPPORT* - Starting @ $1.82/$1.78. *
BASIS* – PG&E is flat from yesterday. SoCal Basis prices are down today after a slight rally yesterday. Forward months are mostly flat today. *
*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. *
PRODUCTION/SUPPLY & DEMAND* –**** ****Today’s Est. Supply = 105.5Bcf/D. Supply 7 Day Avg. = 107.18Bcf. Today’s Estimated Production = 99.7Bcf/D. *
*Latest Demand 7 Day Avg. from 2-29-24 = 112.8Bcf/D. Today’s expected demand = 124.5Bcf. *
***RIG COUNT ****– The next rig count comes out later today. *
WEATHER* – NG Weather has this to say for 2-29-24 – 3-6-24, “Weather systems will impact the West w/rain, snow, and mild to cool highs of 30s to 50s. A frosty weather system will exit the East today but only after a chilly start w/low of -0s to 20s for decently strong national demand. However, much of the US will warm back above normal Fri-Wed w/highs of 50s-80s for very light national demand besides the cool and stormy West where heavy rain and snow is expected. Overall, moderate demand today, then back to light/very light.” 6 – 10-day forecast = bearish. 10-15-day forecast = bearish. 3-month forecast = bearish. Summer forecast = bullish. *
STORAGE* – We are 248Bcf above this time last year. We are 498Bcf above the 5-year average of 1,876Bcf. At 2,374Bcf, we remain above the 5-year average. Estimated storage at the start of Injection season (4-1-24) is 2,100Bcf. Estimated storage at the end of 2024 injection season (10-31-24) is 4,150Bcf. Bearish projections.*
CRUDE –* Current price = $80.10. Forward estimates: 2024 = $75.56, 2025 = $70.57, 2026 = $67.25. *
CA RETAIL POWER* – CAISO stays just above $31MWH. *
*RENEWABLE ENERGY – CO2 Emissions worldwide grew 1.1% in 2023. Highest ever. Increased use of coal in eastern parts of the world is one of the reasons for these record setting numbers. One of the biggest users of coal in these parts of the world…. renewable energy manufacturing. Go figure. *
***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 ****– Both NYMEX and Basis are cheaper than we have seen in quite some time. We are in the Shoulder season and should take advantage of the current market. *
**Indicative Fixed Prices out of April ’24 **
PG&E CG SOCAL CG SoCal Border (+ $0.51 BTS)
1 MONTH $3.29 $3.64 $3.11
3 MONTHS $3.30 $3.85 $3.40
6 MONTHS $3.69 $4.67 $4.33
Winter Strip (Nov ’24 – Feb ’25)
$6.42 $7.42 $6.96
12 MONTHS $4.73 $5.58 $5.23
24 MONTHS $5.03 $5.83 $5.43
Summer Strip (April ’24 – Aug ‘24)
$3.55 $4.53 $4.08