Week of November 11, 2024
Market Overview
Natural gas and crude oil markets are showing mixed signals, with weather patterns and global economic conditions driving current trends.
Key Commodity Prices
- Natural Gas (NYMEX): $2.67/MMBtu, with upward momentum to $2.97/MMBtu on weather outlook
- Crude Oil (WTI): $68.58/bbl
Natural Gas Market Analysis
Supply & Demand Metrics
- Production averaging 100 Bcf/day (down from 104.8 Bcf/day last year)
- Electric power generation demand: 33 Bcf/day
- LNG exports: 13 Bcf/day
- Mexico exports: 5.8 Bcf/day
Storage Status
- Current inventory: 3,932 Bcf
- Storage levels are above both five-year average (+215 Bcf) and last year (+157 Bcf)
Market Outlook
The near-term outlook appears bullish due to:
- Production declining below 100 Bcf/day
- Increasing residential demand with seasonal temperatures
- Potential cold front approaching
Regional Power Markets
Mid-Atlantic Region
- Forward power prices softening due to warm November start
- Day-ahead prices averaging $28.46/MWh (-20% vs. October)
- FERC approved six-month delay for PJM’s 2026/27 capacity auction
Northeast
- ISO New England projects favorable 2024/2025 winter outlook
- LNG terminal capacity and oil inventories at adequate levels
- Transmission upgrades helping maintain price stability
ERCOT (Texas)
- Battery capacity expansion reaching 9,299 MW
- Generation outages expected to decline from 25 GW to 20 GW
- Wind generation fluctuations causing periodic price volatility
Western Markets
- Mild temperatures maintaining low natural gas demand
- Storage near full capacity
- Increased battery capacity affecting evening thermal generation needs
Economic Context
- Interest rates recently adjusted downward
- Equity markets showing positive momentum
- Global demand remains soft, particularly in Europe and China
Weather Outlook
- Eastern U.S. expecting seasonal temperatures with periodic cold fronts
- Heating demand forecast to increase in coming weeks
- Pacific Northwest anticipating below-normal temperatures
Forward Looking Considerations
- Natural gas strip prices (2025-2029): $3.14-$3.47/MMBtu range
- Regional transmission projects affecting congestion patterns
- Growing importance of battery storage in market dynamics
- Continuing evolution of renewable energy integration
Note: All data reflects market conditions as of November 11, 2024