Key Drivers Extreme heat in the southwest – revised forecasts for Midwest lowering the temperature New natural gas drilling activity reduced by U.S. producers throughout 2023 The large natural gas storage surplus from spring reduced substantially throughout summer LNG global issues: U.S. exports expected to jump up soon; Australia’s LNG labor strike Commentary    U.S natural gas producers want higher well-head prices and are reducing drilling activity to try to achieve it.  Natural gas drilling

Key Drivers Slow erosion of natural gas storage surplus vs 5 year average Excessive heat across much of the country weakens except in the south and southwest Daily natural gas production remains strong now, but the wait is on for the 4th Quarter downturn LNG exports:  Will daily LNG demand pick up as winter approaches in Europe? Will El Nino continue to gain strength and how will it affect winter weather here and abroad? Commentary 

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  Key Drivers  Weather – short-term, long-term, hotter than normal, colder than normal…eventually it all matters LNG exports – returning to higher daily numbers after maintenance programs U.S. natural gas production – returning to higher daily volumes after maintenance programs Natural gas prices in Europe/Asia on the rise U.S. Natural gas storage numbers above average   Commentary  The wholesale natural gas and electric markets have been bouncing up and down for a few months.  Are

Key Drivers Natural gas storage is 529 bcf or 29.3% higher than at the same point last year The South and Southwest remain cooler than normal through at least mid-June LNG natural gas exports are strong, but pending maintenance could lower volumes exported Quickly falling natural gas drilling rig count will likely cause lower production later in 2023 Commentary  As we enter June both the fundamental and technical outlook for natural gas and electric in

Key Drivers A few weeks of below normal temperatures in the Midwest and Northeast in April Strong LNG exports to Europe and Asia Weak daily domestic demand Above average natural gas storage levels Summer AC season not too far away Slowing down of new U.S. natural gas drilling programs Commentary  The one big item at the front of many energy conversations is the extreme high cost of utility electric generation rates in Ohio beginning with

Key Drivers Continuing warm weather forecasts in the Midwest and Northeast Lack of cold weather demand in the short-term market Strong LNG exports that could rise even more this summer Upcoming natural gas storage injections beginning later in April The arrival of air conditioning season increasing natural gas and power consumption Long-term global natural gas demand growth is pushing up long-term prices Commentary Electric Utility Prices & Columbia Gas of Ohio Updates: By now most

Key Drivers Highest U.S. Natural gas production since 2019 Lower domestic energy demand in the Fall season Electric demand destruction in FL from Hurricane Ian Sizable U.S. natural gas storage deficit reduction expected in October End of Season storage will still likely trail 5 year storage average and 2021 La Nino this coming winter for 3rd year in a row Weak Polar Vortex forming meaning some very cold winter weather at times for the eastern

Key Drivers July was extremely hot this summer in the U.S. – very high consumption of NG in power generation U.S Natural gas storage deficit heading in the wrong direction.  Looking to be the lowest deficit in many years. U.S. natural gas production is slowly increasing – will higher volumes hit the market before winter? There are fewer speculative traders having a financial appetite at these high prices making price volatility even worse    Commentary

Key Drivers Explosion at the Freeport LNG exporting facility in Texas The news that the repairs on the Freeport facility will take 90 days instead of 3 weeks Higher than expected weekly storage injections since the LNG facility was shut down 2 bcf/day of natural gas staying home in the US instead of being shipped to Europe and Asia The severe storage deficit in the U.S. is no longer severe due to higher storage injections

Key Drivers  Hot May Temperatures Summer expected to average above normal temperatures Natural gas storage 300 bcf behind 5 year average U.S. end of summer storage level expected to be near 3.4 TCF versus being full around 3.9 TCF    Commentary June natural gas NYMEX traded strongly above $9.00 before settling at $8.908/MMBTU. Natural gas prices continue to stay volatile with some strong bullish fundamentals leading the charge higher.  May is starting the Spring/Summer season

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

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

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

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

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