Electricity Markets
Markets continued their downward trend, returning to levels not seen since the beginning of 2022. Continued warmth across the East Coast and Europe continues to take pressure off of gas markets.
After an extreme, but brief, cold snap, milder temperatures have returned resulting in a wild swing in spot pricing. This could signal continued volatility as the weather changes in the coming weeks.
Natural Gas Markets
Forward pricing has fallen well under 2022 historic settle rates. Additionally, 2023 is now trending below both 2024 and 2025, particularly in the winter months, as a result of recent warmth.
Futures as of 1/5/2023 versus previous week:
| Current | ||
| Feb-23 | $3.838 | -$0.871 |
| Mar-23 | $3.551 | -$0.969 |
| Apr-23 | $3.468 | -$0.615 |
| May-23 | $3.497 | -$0.399 |
| Jun-23 | $3.640 | -$0.263 |
| Jul-23 | $3.772 | -$0.259 |
Natural Gas Inventory
Working gas in storage was 2891 BCF as of Friday, December 23rd. According to EIA estimates this represents a net decrease of 213 Bcf from the previous week.
The Baker Hughes exploration gas count decreased by 4 rigs for a total of 152 this week. There are 106 additional rigs in operation than at this time one year ago.
Weather Update
Temperatures continue to remain above average across the United States.
Hurricane Watch: Click here to view the National Hurricane Center site.
Analysis : Falling US gas futures prices, weaker IRRs add to headwinds on 2023 output- As US natural gas producers begin firming up drilling and production plans for 2023, the recent selloff in benchmark Henry Hub futures prices could dampen already modest ambitions for growth this year.
If you would like to receive the Energy Market Update to your inbox weekly, please click here to submit your name and email address. Disclaimer: This information is provided for the use of our customers and potential customers. Power Management Company assumes no responsibility or liability for the accuracy or completeness of pricing or information in this document. Historical data was obtained from sources that we believe to be reliable, but we do not guarantee its accuracy or completeness. It is not intended to provide advice or recommendation. Views are subject to change.