Storage Withdrawal Pushes NYMEX Prices Up
THE One Minute Energy Update for 8-15-24
Today’s highlights -
. Weather is the #1 driving factor until further notice. Pay attention to it.
. Storage levels 16% above 5-year avg but smaller injections have traders concerned about winter volatility.
. 2024 Daily production (through July) averaging 102Bcf/D.
#NYMEX Open = $2.22, High = $2.230 Low = $2.19, Current = $2.28. Approximately +$0.10 from 1 week ago. Approximately -$0.35 from 1 year ago.
NYMEX CALENDAR YEAR ESTIMATES – 2024 = $2.60, 2025 = $3.30, 2026 = $3.57.
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 ($2.38), but above the 20-day ($2.08) and the 9-day ($2.08) average.
#RESISTANCE – Starting @ $2.21/$2.27.
#PIVOT @ $2.17.
#SUPPORT - Starting @ $2.10/$2.06.
#BASIS – #PG&ECGBasis down slightly. #SoCalCGBasis down slightly. Both have room to fall further. Pay attention to our Basis updates to capture the big dips.
#INDEXPRICING
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 = 6.8Bcf. 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 = 7.0Bcf
#SUPPLY - Today’s = 107.9Bcf. 7 Day Avg. = 107.95Bcf.
#PRODUCTION - Today’s Est. = 101.05Bcf.
#DEMAND - Today’s Est.= 102.3Bcf. Latest 7 Day Avg. = 101.32Bcf. National demand High through the weekend then turning to Moderate-High next week.
#RIGCOUNT – Last week’s rig count (8-9-24) - Oil increases by 3 to 485 rigs, natgas falls by 1 to 97 rigs, miscellaneous remains at 6 rigs. The total active rig count is 588. Compare that to 654 active rigs this time last year.
#STORAGE – Today’s guesstimate is a 3Bcf injection. Compare that to 33Bcf last year and the 5-year average of 43bcf. The actual report shows a decrease of 6Bcf. 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 = $77.71. Forward estimates: 2024 = $5.54, 2025 = $71.98, 2026 = $68.72.
#CAISO and #CALIFORNIARETAILPOWER – Grid Status = Normal. CAISO current pricing = $30 - $38.
#CALIFORNIAPOWERGENERATION = NatGas @ 30.4%, RE @ 23.6% (Solar 2.3%, Wind 72.8%), Hydro @ 12.7%, Imports (a lot of which is coal generated power) @ 21.3%, Nuclear @ 8.5%.
#HURRICANE SEASON UPDATE – Hurricane Ernesto is heading towards Bermuda, gaining strength but still on a path to go further out to the Atlantic Ocean.
#WEATHER – Higher temperatures throughout the Pac NW, West, SW, Texas, South. Cooler temperatures for the Mid-Con, Great Lakes, and Northeast regions.
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 – We don’t have the infrastructure or capacity on pipelines to keep up with the growing demand, especially in the West. Gross volatility is inevitable. And when the driving factors shift, expect prices to run up far quicker than they came down. No ifs, ands, or Btus about it.
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. So, going forward, rather than having a massive indicative daily pricing sheet (that changes by the minute), we will simply quote any requests you may have on an individual basis. We will still report on NYMEX and Western Region Basis movement.
ALSO – If you would like an indicative/executable quote, you can simply go to RFPES.com and submit a Request for Proposal (RFP). THE RFP will be sent to all our supply partners who are supplying energy in that region. You choose the time and date you would like to receive the quote – please give 48 hours from the time you submit to the time you want to receive the quote. It takes less than 5 minutes to submit a request for proposal.