A quick market snapshot from Flashpoint’s Darius Lechtenberger:
“WTI crude oil and gasoline prices continue to move upward while diesel price is weak in early trade…this is odd price action for diesel! Crude oil price is getting pushed higher by the loss of approximately 550k bpd of Libya crude oil and rumors of over 900k bpd of lost Russia production due to sanctions. Although, natural gas prices are starting to steal the spotlight from all other energy commodities as natural gas supply and demand fundamentals are quite bullish. Natural gas demand has been very strong as a result of an unusually cool spring that has stoked heating needs in conjunction with a spike in exports as Europe tries to wean itself off Russian gas amid the war in Ukraine. U.S. natural gas inventories are 20% below typical levels. At the same time, traders are staring down forecasts for a hotter-than-normal summer that will almost certainly bolster demand for natural gas to generate electricity as air conditioners get cranked higher. This week has provided a nice pullback in propane prices and even though prices still remain high…this is an opportunity to layer in another round of propane purchases for this coming winter.”
Below is an image of BAM’s summer temperature outlook, in support of Darius’ note above.