In an EBW Analytics Group report despatched to Rigzone by the EBW workforce in the present day, Eli Rubin, an power analyst on the firm, highlighted that the June pure gasoline contract “bounce[ed]… into [the] NYMEX entrance month function”.
“The Could contract rolled off the board at $3.170 yesterday as pure gasoline consumers woke up from a month-long slumber,” Rubin famous within the report, which highlighted that the June pure gasoline contract closed at $3.343 per million British thermal models (MMBtu) on Monday. That shut was up 22.9 cents, the report identified.
“Whereas the near-term elementary outlook stays very tender and Henry Hub spot gasoline costs averaged $2.94 per MMBtu, the magnitude of good points yesterday reset technicals on a path that would attain $3.50 per MMBtu,” Rubin mentioned within the report.
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“Early-cycle manufacturing readings declined this morning however LNG readings are ticking increased. Climate-driven demand stays weak,” Rubin added.
The EBW analyst famous within the report that bearish shoulder season fundamentals should not surprising, nevertheless, and added that they’ve been more and more priced in throughout current weeks.
“As a substitute, near-term worth motion seems extra probably a reduction rally after a $1.60 per MMBtu (- 34 p.c) collapse within the June contract over the previous seven weeks,” Rubin mentioned within the report.
“If the rally extends increased, nevertheless, elementary loosening might show an excessive amount of, too quickly – and should lay the groundwork for a retest of help earlier than the shoulder season is thru,” Rubin went on to warn within the report.
In a separate EBW report despatched to Rigzone by the EBW workforce on Monday, Rubin highlighted that Could contract remaining settlement was “dominat[ing]… near-term buying and selling”.
“The Could pure gasoline contract gained on Friday throughout its choices expiration – however has now examined technical help inside a penny of $2.86 per MMBtu intraday in three straight classes,” Rubin mentioned in that report.
“Even with a supportive cool entrance, nevertheless, weekend Henry Hub spot gasoline costs averaged simply $2.73 per MMBtu. Marcellus spot costs are struggling to maintain $2.00,” Rubin added.
“Climate-driven pure gasoline demand is lowering quickly this week. Permian manufacturing readings are bouncing increased with the top of upkeep on the Permian Freeway Pipeline,” Rubin warned in that report.
“A minefield of triple-digit weekly injections seems forward, whereas technicals for the June contract usually level in direction of continued declines,” Rubin mentioned.
On this report, Rubin went on to notice that “dramatic current losses on the entrance of the curve could arrange profit-taking by shorts because the June contract turns into the NYMEX front-month”.
Rubin warned in that report that “fundamentals could stay weak for many of Could, nevertheless, earlier than possibilities for a extra sturdy rebound in NYMEX futures improves into early summer season”.
In a BMI report despatched to Rigzone by the Fitch Group on Friday, BMI projected that the entrance month Henry Hub pure gasoline worth will common $3.40 per MMBtu in 2025 and $3.80 per MMBtu in 2026. The commodity averaged $2.41 per MMBtu in 2024, the BMI report highlighted.
The U.S. Power Data Administration (EIA) elevated its Henry Hub pure gasoline spot worth forecast for 2025 and 2026 in its newest quick time period power outlook (STEO), which was launched on April 10.
Based on its April STEO, the EIA now sees the Henry Hub spot worth averaging $4.27 per million British thermal models (MMBtu) in 2025 and $4.60 per MMBtu in 2026. In its earlier STEO, which was launched final month, the EIA projected that the Henry Hub spot worth would common $4.19 per MMBtu in 2025 and $4.47 per MMBtu in 2026.
To contact the writer, e-mail andreas.exarheas@rigzone.com
