Natural Gas in Underground Storage

The weekly EIA Natural Gas Storage Report advised today that there was an injection of  112Bcf into Underground Storage for the week ending 9/27/19.

This is 7Bcf above the forecast of a 105Bcf injection, the average prediction of sector analysts and traders in the Dow Jones Newswires weekly survey. This compares with an injection of 98Bcf last year and an 83Bcf injection for the five-year average. Storage is 465Bcf above last year for the same week and 18Bcf below the 5-year average. Working gas in storage stands at 3,317Bcf. (Read More ...)

Natural Gas Pricing


As of 9:24AM CST, November 2019, (the new prompt month) Natural Gas was trading at $2.24, -$0.16 from one week ago and the 1-Year Spread average was $2.37, -$0.08 from one week ago.

Crude Oil Pricing


As of 8:25AM CST, November, 2019, (the new prompt month) Light, Sweet Crude on the NYMEX was at $51.86, -$3.98 from one week ago.

Crude Oil Inventory


US crude inventories increased by 3.1million barrels to 419.5 million for the week ended September 27th, according to data released yesterday morning by the US Dept of Energy. Traders in the Reuters poll projected an increase of 1.6 million barrels.

U.S. Rotary Rigs


According to the Baker Hughes Count, US Rotary Rigs targeting Natural Gas were -2 at 146 for the week ending September 27th and -43 from last year. Rigs targeting Crude were -6 at 713. There are 150 fewer rigs targeting oil than last year. Canadian Rigs were +8 at 127 and -51 from last year. US Rigs drilling for oil remain at 83% of all drilling activity.

Geopolitical


A new Insider poll found that a large majority of Americans strongly favor cleaner sources of energy over fossil fuels — and it's a belief that transcends party lines. The data shows that both self-identified Democrats and Republicans support the idea of the nation transitioning towards renewable sources of energy.

Solar and wind power were the top two preferred alternative energy sources among both groups of respondents, while coal was ranked dead last. Insider's results align with other polling data on renewable energy. A Gallup poll from March found that Americans overwhelmingly favor expanding the production of green energy sources, particularly solar and wind. Around half also said they believed there should be less emphasis on coal power.

The use of renewable energy sources like wind and solar power has doubled in the last decade, according to the US Energy Information Administration, and federal and state policies combined with the declining cost of production drove much of the growth.

Natural gas, which is a cleaner-burning fossil fuel, overtook coal as the nation's top source of electricity in 2016, highlighting the energy transition currently underway in the United States.

However, the Trump administration has loosened environmental regulations and sought to open up more public lands to drilling, and in June it threw a lifeline to the struggling coal industry by easing restrictions on coal-burning power plants. The Energy Information (Read More ...)

Weather

The AccuWeather 1-5 Day Outlook forecasts above-normal temps for the Southeastern 2/3 of the US.  The Western states are projected to be at mostly below-normal temps, while Southern California is expected to be above-normal.

The 6-10 Day Outlook forecasts above-normal temps for the Southeast coastal states, North Central states and part of the Southwest. The Northwest and part of West Texas will be at below-normal temps with the balance of the states at normal temps.

The 11-15 Day Outlook forecasts above-normal temps for Eastern half of the US, except for Eastern Florida and New England, which will be at normal temps. The Northwest and the center of California will be at below-normal temps with the balance of the states at normal temps.

The 30-Day Outlook shows above-normal temps for  the of the Northwest and Southeast, with the exception of the Coastal states, which will be at normal temps. The balance of the country is projected to be at normal temps.

The 90-Day Outlook shows above-normal temps for part of the Northwest and Southeast, with the balance of the country at normal temps.

Severe Weather: The National Hurricane Center shows no hurricane activity in the Atlantic Ocean at this time. There is marginal risk of storms in the US over the next week that could cause damage or demand destruction to electric or natural gas infrastructure.

Sustainability and Renewables

How Big Oil Of The Past Helped Launch The Solar Industry Of Today: Call it a sign of the times.


Renewable energy has gotten so cheap that even oil giant Exxon Mobil, which reported $20.8 billion in earnings in 2018, is getting in on the savings.

Over the next couple of years, Exxon Mobil will begin purchasing wind and solar power in West Texas, part of a 12-year agreement signed late last year with the Danish energy company Orsted. The plan is to use cheap, clean electricity to power Exxon Mobil's expanding operations in the Permian Basin, one of the world's most productive oil fields.

It's not the first time economic considerations have led the company to explore the possibilities of solar.

Half a century ago — before climate change was a topic of much discussion and before Exxon was accused of deceiving shareholders and the public by downplaying the risks of climate change, prompting investigations and lawsuits — the company then known as Jersey Standard funded groundbreaking research into solar photovoltaic technology, which converts sunlight into electricity.

Other oil companies would follow. While the amounts spent by these big firms were tiny compared with their vast resources, these early, critical investments in solar technology laid a foundation for what is now a growing, multibillion-dollar industry
(Read More ...)

This Week's Key Take-Away


As fate would have it, on Tuesday, the U.S. Department of Energy's EIA released its International Energy Outlook, 2019. It's a glorious read, and one that that should be mandatory for all Americans, and even those globally interested in energy. Having open-source information from the US government is a luxury that should be taken advantage of.

You should know that the vast majority of countries have no such access to their own government’s information. Again, this is the official modeling from the U.S. Department of Energy and its National Energy Modeling System. This is not from ExxonMobil, the Sierra Club, or the American Wind Energy Association trying to sell you something or make you think a certain way. This is the outlook of the U.S. Dept. of Energy.

The government is pushing more oil, more natural gas. No kidding. These two fuels still supply nearly 65% of the energy used in the U.S. and global economies. Global annual oil demand has been surging - 1.4 million b/d since 2000 alone, with gas usage up almost 3Tcf annually!

Per the chart above, you can see that Natural Gas prices on the NYMEX are near historical lows. Production continues to rise, outpacing demand. So why are electricity prices not at historic lows as well? Simply stated, in a number of states, (e.g. Texas) there is simply not enough generation, due to early retirement of Natural Gas and Coal generation plants, for economic reasons.