Rd Energy Newsletters & Blogs

RD Energy Stay Current May Newsletter – Flipping The Switch from Heating To Cooling Demand Causes Surge In Energy Prices

Key Drivers  Natural gas demand flips from heating to cooling with higher temperatures in Texas Long Speculators are squeezing the wholesale natural gas and electric markets up too much Natural gas drilling ramping up, but the first deliveries will be 2022 Q4 or 2023 Q1 Will the natural gas storage deficit grow this summer? Very strong LNG exports continue    Commentary In late April natural gas NYMEX settled for May at $7.267/MMBTU. The highest since

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RD Energy April 2022 Stay Current Newsletter: Energy Prices Still Soaring

Key Drivers Revised cooler April temperature outlooks add much more natural gas consumption End of 2022 winter NG storage is at a 19.7% deficit vs 2021 and 14.7 deficit vs the past 5 year average Near record level of LNG exports to Europe and Asia U.S. natural gas production is below pre-COVID 19 March 2020 levels Multiple LNG projects beginning construction adding up to 10 bcf/day export demand by 2025   Commentary April 2022 NYMEX settled

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Wholesale Energy Market Update 3/7/2022

Electric and natural gas prices should probably be somewhat lower than they are right now, but higher oil prices are keeping them not only propped up but climbing.  Natural gas NYMEX this morning is over $5.00/MMBTU.  Even with the strong supply and demand balance of natural gas domestically and globally, natural gas prices fundamentally should be around $4.25/MMBTU.  Because electric prices mostly parallel natural gas prices, electric prices are at historical levels as well.  It’s

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RD Energy Stay Current: March 2022

Key Drivers Ukraine War adding uncertainty and volatility Higher oil prices keeping short-term natural gas prices supported Higher oil prices stimulating oil and natural gas drilling Warming temperatures in March as the worst of winter is behind us Commentary Global and domestic natural gas supplies initially dropped substantially in early 2020 due in large part to lower oil and natural gas production after COVID-19 hit.  The drop in natural gas production has never come close

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RD Energy Stay Current Newsletter: January 2022

Key Drivers Will January through March temperatures in the Midwest and Northeast trend warm or cold? Will LNG deliveries to Europe and Asia continue at a near record pace for all of 2022? How much natural gas production in the Southwest is lost to winter freeze-offs? Will natural gas producers increase drilling in 2022 above 2020 and 2021 levels?   Commentary Would You Rather Listen to the Commentary?   Try our new Podcast! December NYMEX settled at

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RD Energy Stay Current: February 2022

Key Drivers Brutally cold January Cold hanging on at least through mid-February Well freeze offs in the south Strong LNG exports Rapidly declining natural gas storage levels Technical short-squeeze + fundamental strength   Commentary Would You Rather Listen to the Commentary?   Try our new Podcast! While the majority of businesses have electric and natural gas fixed prices this winter, there are still a lot of large energy consumers buying at least a portion of their

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RD Energy Stay Current Newsletter: December – High Coal Prices Are Pushing Electric Prices Up!

    Key Drivers Above normal temperature forecasts for the first week of December New higher LNG record exports in November to Europe and Asia Highest coal prices in over a decade Colder temperatures and possible snowstorm in week 2 of December Commentary Fact: Natural gas is the key driver of electric prices.   False: The two run 100% parallel with each other. Historically natural gas prices and electric prices run in tandem at a 80

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RD Energy Stay Current Energy Newsletter:  November 2021

  Key Drivers Weather forecasts – revised colder and warmer almost daily Dutch TTF gas futures for Europe and Asia trading 5X higher than U.S prices LNG exports to Europe and Asia 2021 rebound of U.S. natural gas production – moderate Commentary FACTS:  Natural gas prices and therefore electric prices have jumped 200% since the end of 2020, which is over 350% since the 2020 NYMEX low point in July 2020.  We also know that

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RD Energy Stay Current Newsletter: October 2021  So Hot AC Load Is Back

  Key Wholesale Energy Market Drivers Natural Gas prices in Europe and Asian are trading 7X greater than U.S. U.S. Natural Gas storage deficit versus 2020 is at 500 BCF October 2021 will likely be the warmest October on record in the U.S. adding extra cooling demand Commentary  The average natural gas NYMEX price for all of 2020 was $2.077/MMBTU.  Natural gas prices for October 2021 delivery closed at $5.841/MMBTU.  Prices in Europe and Asia

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RD Energy Stay Current Newsletter Special Edition: Electric & Natural Gas Prices Surging Over 250%

Electric & Natural Gas Prices Surging Over 250% Businesses’ that paid $.33/ccf last winter could be paying $.73/ccf this winter.   Manufacturers who were quoted fixed rates at .037/kWh for multiple terms earlier this year will be seeing rates around $.047/kWh  Commentary  Natural Gas NYMEX is rising fast and furious.  September NYMEX settled for the month at $4.37/MMBTU in late August.  This was the second highest settlement price since December 2018 and the 4th highest since

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RD Energy Stay Current Newsletter: Energy Markets Gets Hit With One Two Punch, But No Knockout!

  Key Wholesale Energy Market Drivers Natural gas U.S. storage deficit continues to grow week after week Hurricane Ida plows through Gulf area shutting down production Onshore processing plants possibly lose power for weeks Will U.S. natural gas storage deficit grow beyond expected 500 bcf shortfall Electric cooling degree day drops substantially beginning Sept in high power consuming NE   Commentary  Hurricane Ida staggered the energy markets with quite the punch, but achieved no knockout.  Nearly

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RD Energy Stay Current: May 2021

  Key Drivers U.S. Storage inventories are 302 bcf behind 2020 levels European natural gas inventories ended the winter at a very concerning 11% below their 5 year average European natural gas (NG) prices have shot up making U.S. LNG exports to Europe even more profitable LNG export demand is currently 11.5 bcf/day vs 4.5 bcf/day during the summer of 2020 In April speculator NG NYMEX traders lowered their short positions as they wait for new

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RD Energy’s Stay Current Newsletter: April 2021

  Key Drivers January – April 2021 NYMEX natural gas prices are averaging more than 40% higher than the same four months one year ago Short-term NYMEX prices rise and fall with the changing weather forecasts Long-term: NG storage levels, NG production levels, AC demand & LNG exports will drive NG and electric wholesale prices Commentary  While it’s human nature to watch short-term energy prices our real focus needs to be on the future.  Short-term cash

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RD Energy’s Stay Current Special Edition: ERCOT power outages; Will it happen in Ohio

Power outages on the ERCOT electric grid in Texas are currently widespread and life threatening.  Millions are without power not because of downed lines, but because their electric grid wasn’t able to add extra power when it was needed.  Why is this happening in Texas and can it happen behind our Ohio power grid PJM?  How close are we to experiencing the same thing?   First we need to understand the difference between the two grids

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RD Energy’s Stay Current: February 2021 – The Polar Vortex Is All Bent Out Of Shape

Key Wholesale Drivers Very large natural gas storage withdrawals are coming up in the next few weeks hitting U.S. natural gas storage hard The Greenland Ridge and Alaskan Ridge are combing with a split Polar Vortex in sending extreme cold into the U.S. for possibly weeks December and January showed a bump up in U.S natural gas supply, but was it a false indicator?  Yes. Will the U.S. exit winter with a storage deficit compared

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RD Energy Stay Current Newsletter: January 2021. We Thought 2020 Was Bad

Key Wholesale Drivers Shrinking year over year U.S. natural gas storage surplus Higher year over year Canadian natural gas imports Record breaking LNG exports Extreme cold in Asia and Europe   Commentary  As excited as we all were about leaving the year 2020,  natural gas and electric prices in 2021 could easily turn into one to remember and one to try and forget.  While wholesale price volatility has increased the past few months prices have

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RD Energy’s Stay Current: December 2020

  Key Drivers  The falling of the year-over-year natural gas storage surplus Third warmest November in the past 70 years LNG exports hitting new record high level U.S natural gas supply production dropping back to 2018 levels What oil and natural gas price will stimulate investment in new drilling? Natural gas prices is the key driver of electric prices Commentary Was the very warm November the calm before the storm?  As we enter December there’s

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RD Energy’s Stay Current: November 2020

Key Drivers The natural gas storage surplus has dropped by about 50% since August Current U.S natural gas production levels have dropped to 2018 levels Flat oil prices expected through 2021 will keep new oil and gas drilling minimal LNG exports have increased nearly every week matching or beating all time export numbers Recent earnings calls from Gulf and Appalachian producers place importance on paying down debt and dividends and not new exploration NYMEX has

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RD Energy’s Stay Current: October 2020

Key Drivers U.S. Natural gas storage is still running ahead of this time last year (up 14%) as well as ahead of the past 5 year average (up 12%) Multiple LNG terminals still off-line from Hurricane Laura weakening short term daily spot prices Rising global demand for LNG with winter nearing and more than a dozen empty cargo ships waiting in the Gulf for the U.S. LNG terminals to come back on-line $40 oil keeping

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RD Energy’s Stay Current: September 2020

Key Drivers Natural gas NYMEX closed in late August for September delivery at $2.579/MMBTU up $.725/MMBTU from the month before Traders are pricing into their trading models either a major natural gas supply shortage this winter or a surge in natural gas demand or both. LNG Export terminals suffered very little to no damage from Hurricane Laura.  Many LNG cargo ships are sitting in the Gulf waiting to be loaded with new LNG supply. Oil

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