In an EBW Analytics Group report despatched to Rigzone by the EBW group right this moment, Eli Rubin, an vitality analyst on the firm, mentioned the Might pure gasoline contract is “flirting with [the] $3.00 per million British thermal items (MMBtu) psychological degree”.
“The Might pure gasoline contract sank to $2.994 yesterday and closed at $3.016 – a 12 months so far low,” Rubin famous within the report, including that Henry Hub spot pure gasoline traded at $3.15 per MMBtu.
“Whereas the $3.00 degree might supply help, technicals point out additional weak spot forward,” Rubin warned within the report.
- Advertisement -
“Nonetheless, upkeep on the Permian Freeway pipeline might restrict provides to the Gulf Coast this week, sustained climate pushed demand is feasible into the weekend, and day by day LNG feedgas nominations are up with recoveries at Sabine Cross and Plaquemines,” Rubin went on to state.
In keeping with Rubin, basic catalysts aligning with the $3.00 benchmark might stop additional declines.
“Nonetheless, the emergence of storage surpluses and really weak spring fundamentals counsel deeper losses might proceed,” Rubin mentioned within the report.
“Might-October contracts common $3.37 per MMBtu, and one other 10 % decline would put costs on a trajectory to achieve the October five-year storage common of three,753 billion cubic toes,” Rubin added.
“Whereas the outlook for Cal 2026 more and more seems underpriced, it might stay so for an prolonged interval earlier than ultimately rising,” Rubin added.
In a separate EBW report despatched to Rigzone by the EBW group yesterday, Rubin famous that the pure gasoline bodily market was displaying “indicators of weak spot”.
“The Might pure gasoline contract flirted with the 200-day shifting common at $3.21 per MMBtu repeatedly final week, however closed above the important thing benchmark each day,” Rubin highlighted in that report.
“As Henry Hub spot costs dropped beneath $3.00 over the weekend to a ten-week low, nonetheless, rising bearish stress might open the best way for close to to medium time period declines,” Rubin warned.
“Additional, help from final week’s chilly is fading. By the tip of week three, a 74 billion cubic foot storage deficit to five-year normals might flip to a 25 billion cubic foot surplus,” Rubin continued.
“LNG is softening at Sabine Cross. April manufacturing is nearly 40 billion cubic toes per week increased 12 months over 12 months, though upkeep on Permian Freeway Pipeline might restrict provide later this week,” Rubin mentioned.
Rubin went on to level out in that report that long-term contracts have been “holding up comparatively nicely”.
“Regardless of a 28.2 cent plunge within the Might contract final week, 1Q2026 futures dipped 1.7 cents. Technical resistance might maintain, however mounting basic stress (triple-digit injections haven’t but begun) suggests one other leg decrease over the subsequent 30-45 days,” Rubin mentioned.
The EBW group knowledgeable Rigzone that it didn’t publish an expanded version of its report on Friday. In one other EBW report despatched to Rigzone on Thursday, Rubin highlighted that the Might pure gasoline contract slid to a “recent 10 week low”.
“The NYMEX front-month closed a hair underneath $3.25 per MMBtu yesterday, reaching the bottom ranges since early February,” Rubin mentioned in that report.
“Intraday buying and selling once more noticed help on the 200-day shifting common of $3.21 – however falling climate pushed demand might proceed to weigh on pricing. Henry Hub spot costs averaged $3.21,” Rubin added.
On this report, Rubin went on to warn that the outlook was weak over the subsequent 30-45 days, “with projected triple-digit injections and a nascent storage surplus”.
“Pressured promoting over the previous two weeks, nonetheless, creates a dynamic whereby longs are in search of indicators of a firmer backside to reestablish positions,” Rubin mentioned.
“Winter 2025-26 gasoline futures already rose yesterday, for instance, regardless of weak spot on the entrance of the curve,” Rubin went on to state in that report.
The U.S. Power Info Administration (EIA) boosted its Henry Hub pure gasoline spot worth forecast for 2025 and 2026 in its newest brief time period vitality outlook (STEO), which was launched on April 10.
In keeping with its April STEO, the EIA now sees the Henry Hub spot worth averaging $4.27 per million British thermal items (MMBtu) this 12 months and $4.60 per MMBtu subsequent 12 months. In its earlier STEO, which was launched in March, the EIA noticed the Henry Hub spot worth averaging $4.19 per MMBtu in 2025 and $4.47 per MMBtu in 2026.
The EIA projected in its April STEO that the Henry Hub spot worth will are available in at $3.93 per MMBtu within the second quarter of 2025. In its March STEO, the EIA projected that the Henry Hub spot worth would common $3.88 per MMBtu within the second quarter of this 12 months.
To contact the writer, electronic mail andreas.exarheas@rigzone.com
