Weekly Energy Market Watch

Market Commentary | Week Ending 4/30

Natural gas advances on strong export demand and production declines.

Monday 4/26

The May-2021 NYMEX natural gas contract gained 6.0 cents to $2.790 per MMBtu as the prior week’s late-season chill was expected to lead to a historically small storage injection. The Jun-2021 WTI crude oil contract dipped 23 cents lower to $62.94 per barrel as climbing COVID-19 cases in India, the world’s third largest oil importer, raised concerns over a potential dent in demand. Equity markets traded in a mixed fashion as investors looked ahead to a busy week of first quarter corporate earnings releases during the week.

Tuesday 4/27

Natural gas pressed 8.3 cents higher to $2.873 due to near full capacity feed gas demand from LNG export facilities and record cross-border pipeline exports to Mexico. Crude oil jumped $1.03 higher to $62.94 ahead of a production meeting between OPEC and its allies later in the week. Stocks were steady as investors looked ahead to the Fed’s economic assessment Wednesday and the release of some big tech earnings.

Wednesday 4/28

The May-2021 NYMEX natural gas contract closed and expired 5.2 cents higher at $2.925 on lower production and ahead of Thursday’s storage report, which was expected to show a small build that would compare to the 5-year average 67 Bcf build. Crude advanced 92 cents to settle at $63.86 after the EIA reported a marginal 0.1-Million-barrel increase in oil inventories. Stocks lost ground as investors digested Fed Chair Jerome Powell’s press conference on the economy.

Thursday 4/29

The new prompt Jun-2021 NYMEX natural gas contract shed 4.9 cents to $2.911 even after the EIA reported a lower-than-expected 15 Bcf build in storage, which flipped the surplus to the 5-year average back to a 40 Bcf deficit. Crude oil pushed $1.15 higher to $65.01 as strong U.S. economic data outweighed rising COVID-19 concerns in Brazil and India. Equities surged with support from an upbeat first quarter GDP report, which showed the economy was off just 1% from its peak in late-2019.

Friday 4/30

Natural gas rebounded 2.0 cents to $2.931 with support from strong export demand and maintenance-related production declines. Oil backed away from a 6-week high following weak crude import data out of Japan and on escalating concerns over fuel demand in India. The front month contract fell $1.43 to end the week at $63.58. Equity markets retreated late in the session on concerns over global supply chain disruptions.

Looking Ahead

Natural gas traders will look for summer weather forecasts to come out to gauge power sector demand.

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