Wholesale electric prices over the report week were overwhelmingly flat, with the exception of ERCOT which again moved higher. In addition to the coal plant closure announcements and nervousness about load reliability during the summer, the economy in Texas has been heated. Energy prices in this market are unrestrained which could cause some anxiety moving forward.
As the long run of above average weather ended, more normal conditions caused a slight uptick on the day-ahead market for ISO-NE. The storm at the beginning of the report week did not have any serious impact on prices. There was the presence of rain and snow but no real extreme cold.
Natural Gas Markets
The 12-month strip was up $0.10 across the board. As Spring and warmth is approaching, we may see a weakening of demand. Over the last few years $3.00/MMBtu seems to be the “normal” range that natural gas has settled into the last half of the year or so.
Six-Month Natural Gas Futures
Futures as of 3/7/18 versus previous week:
Apr. $2.777 +0.110
May. $2.806 +0.110
Jun. $2.847 +0.112
Jul. $2.892 +0.113
Aug. $ 2.899 +0.108
Sep. $2.878 +0.105
Natural Gas Inventory
As of Friday, March 2, 2018, working gas in storage was 1,625 Bcf. According to EIA estimates, this represents a net decrease of 57 Bcf from the previous week. This was in line with market expectations, and as a result the market moved down slightly for the first time in a while. There was a 57 Bcf withdrawal last year as well and the five-year average is 129.
NG Rig Count
The Baker Hughes exploration gas rig count increased by 7 rigs to a total of 188 rigs. The report total is 37 rigs more than in operation last year when there were 151 rigs.
The Western CONUS is expected to see some cooler-than-normal temperatures through the middle of March. The NOAA forecast is calling for a return of the warmer-than-normal temperatures for much of the East and South.
National Weather Service Updates (NOAA)
Hurricane Watch- No Activity: Click here to view the National Hurricane Center site.
Equatorial Pacific Outlook: Click here to view La Nina and El Nino status.
Energy News & Resources
TRENTON, N.J. — New Jersey’s largest utility is canceling spending on capital projects at a nuclear plant because a $300 million taxpayer-funded financial bailout of the state’s nuclear industry has stalled in the Legislature.
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