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MARKET TREND ANALYSIS

Weekly Energy Market Updates by Region - Archive

 

 

 


Issue week: July 23rd, 2020  (Wk 30)

 

POWER MARKETS

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WEST Index prices in Mid-C have fallen because of both another partial dera-tion of the AC transmission line and a slight drop in temperatures. Meanwhile, in California, a lack of intense heat in the forecasts seems to be mitigating the effects of an announcement by SoCal Gas of restrictions in the flow of natural gas in both directions from July 22 through August 6 at Aliso Canyon as part of a high-inventory shut-in maintenance event. For the month to date, average index prices in both Mid-C and SP15 remain very soft at $11/MWh and $26/MWh, respectively.

ERCOT  So far in July, real-time prices have stayed in the low $20s/MWh and the ORDC adder has been minimal. This week, term prices are also down, led by heat rates. The mild weather expected over the next few days should keep a lid on spot prices in the near term. Even basis is low in all four load zones. For in-stance, basis in the West Load Zone, which settled over $50/MWh for February, is under a nickel for July!

EAST On Monday, peaks for this summer so far were set in ISO-NE, NYISO, and PJM. Nonetheless, prices remained relatively stable for such a high-demand day. In Mass Hub and Hudson Valley, Day Ahead was higher than Real Time by ap-proximately $5/MWh. In PJM’s West Hub, Day Ahead beat Real Time by $17/MWh on average. Yesterday saw the return of volatility in Real Time prices across ISOs; they reached as high as $637/MWh in PJM’s DPL.

NATURAL GAS 

The EIA reported Thursday morn-ing that, for the week ending July 17, U.S. inventories increased by 37 Bcf, slightly in the upper half of the anticipated range of 28-45 Bcf. Total stockpiles now stand at 3,215 Bcf, up by 25.6% from a year ago and 15.7% above the five-year average for the same week. Despite forecasts of cooler weather, the 37 Bcf injection ap-parently failed to impress the market bears. The NYMEX prompt-month contract was up by $0.092/MMBtu from Wednes-day’s final at $1.773/MMBtu as of 10:00 a.m. PDT. All months through May 2021 rose as well. The fall in basis at SoCal Border ranged from almost a dime over the next six months down to a penny for the following four and a half years. In PG&E Citygate, basis rose for the period from January 2021 to 60 months from now by amounts ranging from $0.005/MMBtu to $0.010/MMBtu. July cash prices were lower at both PG&E and SoCal Citygates.

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