The Energy Buyer's Guide | 07.22.2024
Natural gas continued lower despite the highest power generation demand so far this season.
- Natural gas futures were down sharply last week, especially near the front of the forward curve. Cooler forecasts for the next two weeks along with an ongoing outage at Freeport LNG led to a return of bearish sentiment in the market.
- Natural gas storage inventories increased by just 10 Bcf during the week ended July 12, according to Thursday’s report. The build came in well shy of historical benchmarks and lagged market expectations.
- Freeport LNG was mostly offline again last week, but feedgas volumes began ramping back up on Thursday and Friday. (Link)
- PJM’s peak load of nearly 154 GW on Tuesday was the highest in more than a decade. However, demand waned as the week progressed and real-time prices dropped sharply from early-week highs. (Link)
Natural gas futures were down across the board last week, pressured by bearish temperature forecasts, strong domestic production, and an ongoing outage at the Freeport LNG export terminal. Prices did mount a slight recovery on Thursday and Friday surrounding a supportive storage report that showed underground inventories grew by just 10 Bcf during the previous week. The prompt-month August 2024 contract was especially weak, dropping another $0.20 per MMBtu on the week. At week’s end, that contract was down by more than $1 per MMBtu, or about 34% from its high traded in mid-June. Winter 2024-25 and Summer 25 were off as well, but not near to the same degree as the weakness observed on the front of the forward curve. These strips both finished the week near multi-year lows.