Weekly Energy Market Watch

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Jonathan Lee Senior Energy Market Intelligence Manager at ENGIE Impact
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Market Commentary | Week Ending 1/14/2022

Natural gas finds continued weather-related support.

Monday 1/10

The Feb-2022 NYMEX natural gas contract pressed 16.3 cents higher to $4.079 per MMBtu as weekend weather models called for a deep trough of chilly temperatures to descend into the central and eastern U.S. during the latter third of January. Equity markets retreated as rising government bond yields weighed on tech stocks. Crude oil stumbled on concerns higher interest rates could slow economic activity and reduce demand for the commodity. The Feb-2022 WTI crude oil contract settled 67 cents lower at $78.23 per barrel.


Tuesday 1/11

Natural gas climbed 17.0 cents higher to $4.249 as forecasts continued to call for a chilly second half of January, which would make it the coldest since the 2014 polar vortex. Crude bounced $2.99 higher to $81.22 after Libya’s oil output suffered further setbacks after bad weather forced four terminals to temporarily close. Stocks rebounded after Fed Chair Powell laid out the central bank’s plan to corral rising inflation and fix the supply chain.


Wednesday 1/12

Natural gas soared 60.8 cents higher to $4.857 on a stronger demand outlook after the European weather model shifted decidedly colder for late-January. Crude pushed $1.42 higher to close at $82.64 after the EIA reported a 4.6-Million-barrel decline in domestic oil inventories. Equities traded in the green as investors prepared for the start of fourth quarter corporate earnings season the following week.


Thursday 1/13

Natural gas gave back 58.7 cents to settle at $4.270 even after the EIA reported a 179 Bcf draw from storage, which was the largest of the season and narrowed the surplus to the 5-year average to 72 Bcf. The price of oil declined 52 cents to $82.12 after Libyan output gradually recovered to about a million barrels a day after severe weather caused disruptions. Equity markets lost ground after the Bureau of Labor Statistics revealed annual wholesale inflation was at a record high.


Friday 1/14

Natural gas was marginally changed as forecasts continued to call for Arctic air to spill into the Midwest and Northeast toward the end of the month. The cost of front-month gas dipped 0.8 cents to finish the week at $4.262. Oil jumped $1.70 to $83.82 as traders grew increasingly concerned tensions between Russia and the Ukraine could spread throughout the region. Equities suffered another round of losses after the Commerce Department reported a disappointing 1.9% decline in retail sales during December.

Looking Ahead

Natural gas prices will find continued support as long as cold weather is forecast for the major consuming regions.

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