As we exit a historically warm winter, natural gas storage sits at a healthy surplus that’s kept near-term pricing low. These increased storage levels have affected power pricing as well, with gas continuing to be a low-cost fuel source for the generation stack. Producers have been able to curb some of the freefall by starting to pull back on drilling.

Near- and long-term pricing are two different stories, however, as both power and gas markets are eyeing the increased demand both LNG exports and grid electrification will add to the equation. End users of both commodities should consider their long-term energy strategy and weigh what these unknowns could mean to their energy budget should upward pressure continue to be applied to the back of the curve.

To learn more about how this impacts your business, reach out to your IGS Energy rep or email EnergyAdvisors@igs.com.

Click here to share your thoughts on our market commentary!