Please note there will not be a video for the Weekly Energy Market Update for the week of May 6, 2013. Receive weekly updates that are sent right to your email inbox: click here to subscribe.

The following is a summary of last week’s market activity and the market outlook:

• Natural gas prices fell significantly this week, amidst significant volatility. NYMEX futures rallied on Monday, but then fell by 20 cents on Thursday — the biggest decline in almost two years. The drop was caused by a very bearish natural gas storage report and forecasts for moderate weather across much of the U.S.
• The EIA reported a storage injection of 43 Bcf for the week ending April 26. Current domestic storage inventories are now at 1,777 Bcf, which is 795 Bcf(30.9%) below 2012 and 118 Bcf (6.2%) below the 5-year average for this date.
• According to Baker Hughes, U.S. natural gas rig counts fell by 12 rigs last week to 354, which is 286 rigs (41.2%) below a year ago. Horizontal rigs increased by eight and are now 49 rigs (4.2%) below a year ago.

Please visit the Direct Energy Business online customer education center, known as Energy Insights, to view my Weekly Energy Market Update video for April 29, 2013. Receive weekly updates that are sent right to your email inbox: click here to subscribe.

The following is a summary of last week’s market activity and the market outlook:

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Please visit the Direct Energy Business online customer education center, known as Energy Insights, to view my Weekly Energy Market Update video for April 22, 2013. Receive weekly updates that are sent right to your email inbox: click here to subscribe.

The following is a summary of last week’s market activity and the market outlook:

• Natural gas rallied again with a 19-cent gain on Thursday, following a bullish storage report (the storage refill season is off to a very slow start) and overall cold weather. May futures closed on Friday, April 22 at $4.40 — the highest Prompt Month settle since July 20, 2011. At $4.52, the 12-month Strip is above all Calendar Strips through 2016. Calendars ’14 and ’15 are both at $4.40 for the first time since December 2011 and November 2012, respectively.
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Per this week’s Energy Market Update, I have provided some in-depth energy buying strategies in the current volatile market. Briefly, a month ago NYMEX futures broke out of their range and exceeded $3.60 per MMBtu for the first time in four months.  A month later prompt month gas futures are $4.20 for the first time since July 2011. Why, you ask? The primary reason: March was COLD. Heating demand depleted storage inventories to levels not seen since the last time gas was over $4.10. But the long-term picture is not as grim. Gas futures for 2014 are up significantly less than the near-term, and 2015 and 2016 are down. The bottom line is that the rally is being driven by near-term fundamentals while long –term prices have stabilized, thanks to shale reserves resulting in a much flatter forward curve.

The details are in the numbers below
                                             Prices as of 4/12/13         Change since 3/7/13
Prompt month natural gas    4.22                                  +0.64
12-Month Strip                      4.37                                  +0.52
Calendar 2014                      4.26                                  +0.15
Calendar 2015                      4.27                                   -0.03
Calendar 2016                      4.36                                   -0.09
($ per MMBtu)

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