Market Commentary

Weekly Recap

May 12, 2014

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  • The NYMEX shed 15 cents from the 12 month strip to settle just above 4.50. This is the lowest the strip has settled since early April.
  • An injection of 74 BCF marks the third week in a row that injections have been above the 5 Year Average.
  • The combination of bearish weather along with natural gas prices that do not support coal-to-gas switching are leading analysts to expect strong injections in the near future. The upcoming two injections are each predicted to exceed both the 5 Year Average and 2013 same-week injections.
  • Power prices did not perform as bearishly last week. With summer nearing and spring maintenance on nuclear power plants underway, it is not overly surprising to see power prices decouple from natural gas prices this time of year.