Market Commentary

Market Commentary

Weekly Recap

Stay up to date on the latest information and changes that may impact natural gas and electricity pricing with the Market Commentary. Download a PDF version of this week’s Market Commentary here.

DAILY NATURAL GAS SETTLEMENTS

A quiet week on the NYMEX natural gas market took a turn on Friday when the market jumped up more than 11 cents to settle the week a hair below $2.30. The 12 month average settled up about 11 cents at $2.527.

LAST WEEK ON THE NYMEX

The prompt month February 2016 contract expired Wednesday at $2.189. This is down a little over 18 cents from January’s expiration. March began trading as the prompt month on Thursday and settled at $2.182, picking up almost exactly where Feb left off.

NATURAL GAS IN US STORAGE

A withdrawal of 211 BCF from natural gas storage came in a bit above expectations. While weather has been somewhat back and forth between typical winter cold and unseasonable warmth, one factor that has remained consistent is continued coal to gas switching for power generation due to the low cost of gas. January was a record month for power based natural gas demand.

NOAA 6-10 Day Outlook

Some cooling in the forecast for most of the central United States comes as a change from the recent warm weather. Here in central Ohio temperatures have been in the 50’s for several days now. The West Coast and New England continue to expect well above average temperatures.

WEEKLY COMMODITY CHANGES IN POWER MARKETS

A slightly bullish week for power was about on par with natural gas trading. Most markets experienced gains between 1-2%. A lack of continually cold weather, particularly in the Northeast, and the aforementioned natural gas based generation has helped to keep power prices relatively stable during winter months where price spikes can sometimes occur.

The comments made above regarding the NYMEX futures market are the sole opinion of the author, not necessarily the opinions of Interstate Gas Supply, its officers or its employees. Information provided in this “Market Update” is for illustration purposes only, and neither the author nor Interstate Gas Supply shall be liable for any information contained herein.

IGS Energy provides weekly analysis and market updates on industrial and commercial natural gas news. We cover natural gas prices, futures, and national storage information, giving you the most accurate market data.

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