October 2020 gas futures are down over 8 cents from last week, settling at $2.406/MMBtu on Wednesday.
Today's injection of 70 Bcf was slightly larger than expected and lifted total gas in storage to 3,525 Bcf, 13% above the 5 year average.
Electricity
The 30 day average price of real time power continues to trend downward, falling almost another $0.80/MWh to $22.44/MWh.
Power futures are up slightly from a week ago as the market continues to be seek direction. The 12 month strip settled Wednesday at $30.06/MWh.
12 & 24 Month NYMEX Strip
12 & 24 Month Zone A Power Strip
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The average spot price differentials between regional natural gas hubs and the Henry Hub, also typically known in the natural gas industry as the basis price, have narrowed at many trading hubs in the first half of 2020 compared with the first half of 2019. Natural gas basis reflects the difference between the price of natural gas at the benchmark Henry Hub in Louisiana and the price of natural gas at another delivery point elsewhere in the country. The basis at key demand hubs (near population centers) narrowed primarily because of weather-related factors, and the basis at some supply hubs (near production areas) narrowed because of decreases in natural gas production. Declines in economic activity related to coronavirus disease (COVID-19) and its mitigation efforts generally helped to further narrow the basis at both demand and supply hubs.
Demand for natural gas at U.S. commercial and industrial establishments declined from March through June 2020 because of reduced economic activity related to COVID-19, which also contributed to relatively narrow basis prices.
