Nearing the End of Withdrawal Season

Nearing the End of Withdrawal Season

THE One Minute Energy Update for 3-14-24


***#NYMEXUp #PG&EBasisDown #SoCalGasBasisDown #WeatherSplit #YouWillNeedCarbonOffsetsBeforeYouKnowIt ***

***NYMEX pricing so far today - ****Open = $1.79, High = $1.82, Low = $1.76, Current = $1.81 – a $0.15 jump from yesterday’s low. NYMEX prices are down approximately $0.25 from 1 week ago and down approximately $0.95 from 1 year ago. *

NYMEX CALENDAR YEAR ESTIMATES* – 2024 = $2.41, 2025 = $3.43, 2026 = $3.78.*

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

*We are below the 50-day ($2.14), above the 20-day ($1.74) and above the 9-day ($1.80) average. *

RESISTANCE* – Starting @ $1.74/$1.78. Already passed it.*

THE PIVOT* @ $1.67. Blew passed it. *

SUPPORT* - Starting @ $1.63/$1.60. Weather and supply could get us there by next week, or not.*

BASIS* – Same as yesterday! Both PG&E and SoCal Basis prices continue to fall. *We are in the buying range.

*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. *

***LNG EXPORTS, NG EXPORTS, NG IMPORTS ****– As of 3-12-24 - Exports averaging 13.4Bcf/D. Exported gas to Mexico averaging 6.3Bcf. Imports from Canada averaging 3.9Bcf/D. *

PRODUCTION/SUPPLY & DEMAND* – Today’s Est. Supply = 107.1Bcf/D. Supply 7 Day Avg. = 107.1Bcf. Today’s Estimated Production = 102.0Bcf/D. Yesterday’s demand = 101.0Bcf. Latest Demand 7 Day Avg. = 107.1Bcf/D. Demand is expected to be very low through the weekend. *

***RIG COUNT ****– The next oil & gas rig count comes out tomorrow. *

WEATHER* – has this to say for the next 6 days, “Most of the interior US will be mild/ nice into Saturday w/highs of 50s-80s. A chilly weather system will track across the central, southern, and eastern US late this weekend into next week w/rain, snow, and highs of 20s-40s for stronger demand, while the West warms into the 50s-80s as high pressure strengthens. Overall, Very Low demand through Saturday, then Moderate.”. 5 – 10-day forecast = bullish with west heat and east cold. 10-15-day forecast = bearish. 3-month forecast = bearish. Summer forecast = bullish. *

STORAGE* – The latest forecast for today’s storage report was a withdrawal of 3Bcf. The actual report comes in with a withdrawal of 9Bcf. We are now 336Bcf above this time last year and 629Bcf above the 5-year average of 1,696Bcf. At 2,325Bcf, we are above the 5-year historical range.*

***CRUDE – ****Crude is rallying since yesterday’s EIA inventory report and Ukraine drone strikes on Russian refineries. OPEC predicts 2024 consumption will increase by a whopping 2.2%. Current price = $81.13. Forward estimates: 2024 = $77.56, 2025 = $72.30, 2026 = $68.61. *****

CA RETAIL POWER* – CAISO testing $25 per MWH. *

RENEWABLE ENERGY* – Environmental Health News has this to report, “New legislation and Biden administration policies are breathing life into the nuclear power sector, marking a significant shift toward embracing it as a key carbon-free energy source. Billions of dollars are being funneled into advancing nuclear technology and domestic uranium production, indicating strong bipartisan agreement on its importance for America's energy future. Regulatory changes aim to streamline the licensing process for advanced reactors, promising to expedite the development of cleaner, more efficient nuclear energy.” This is a step in the right direction.*

On the dumber side of renewable energy, the US added more solar power in 2023 than any previous year. With a whopping 32GW of solar energy produced in 2023 alone, that adds up to less than 6% of all energy sources. A huge waste of time, money, and land, and so on, and so on, and so on.

***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 – ***NYMEX could rally over the today through mid-week of next week. We have above normal temps for the West and below normal for the East. Let’s see how supply stands up to a change in demand. PG&E and SoCal Basis continue to fall. Don’t sit on these cheaper Basis prices. Please remember that we can buy NYMEX and Basis separately. Catch them both on the down. It’s been working for us, right?

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

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

1 MONTH $2.89 $2.76 $2.48

3 MONTHS $2.93 $2.95 $2.62

6 MONTHS $3.42 $3.97 $3.62

12 MONTHS $4.52 $5.18 $4.83

24 MONTHS $4.91 $5.55 $5.14

Summer Strip (April ’24 – Aug ‘24)

$3.29 $3.79 $3.43

Winter Strip (Nov ’24 – Feb ’25)

$6.30 $7.29 $6.94