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Washingto Gas Energy Services: A Washington Gas Affiliate Complany
Volume 8, Issue 49
We know how to deliver energy.
December 4, 2009 Energy Update
In this Issue
Editors Note
Week in review for period of November 27, 2009 to December 3, 2009.
Natural Gas
EIA Gas Storage Update
Baker Hughes Rotary Rig Count
NYMEX Natural Gas Monthly Settlements
NYMEX Values: Thursday, December 3, 2009
NYMEX 12-Mo. Avg. Price Per Therm at the Well-Head
PJM Electricity
PJM 12-Month Average Peak Power Price
Weather
Local Heating Degree Days*
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Editors Note
Week in review for period of November 27, 2009 to December 3, 2009.

In the last newsletter, natural gas prices rose 7% and electricity prices rose 5%. However, for this seven day period, the roles were reversed. The "bearish" fundamentals overwhelmed the "bulls" this week and thus energy prices fell. The 12 month average price for natural gas at the well-head fell by 8%. The average 12 month price for electricity on the PJM fell by 7.4%. Crude oil prices were flat again closing at $76/barrel. Here are some factors that placed downward pressure on prices this week: First, Forecasters have revised their 8-14 day forecast. They are now calling for normal temperatures instead of colder than normal temperatures. Weather is a big factor this time of year. Second, for the second week in a row, natural gas was injected into storage during this withdrawal season. Storage levels are at record highs. Lastly, shale gas discoveries are offsetting the large reduction in active drilling rigs. Stay tuned. Winter is definitely the wild card for now. Please call us with questions.

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Natural Gas
EIA Gas Storage Update

 

 Current Week

Last Week 

Net Change

 Last Year 

 5 Year

 

 Stocks (Bcf)

Stocks (Bcf)

 (Bcf)

Stocks (Bcf)

 Average (Bcf)

 Total Lower 48

3,837

3,835

2

3,367

3,350

Storage Update:  Inventory levels grew by 2 bcf.  Mild weather is one reason for the gas injection.  Last year we had a withdrawal of 48 bcf. Working gas in storage for the week ending 11/27/09 was 3,837 bcf following last week’s unexpected injection of 2 bcf. The inventories are 13.9% above last year’s levels. We are 14.5% above the 5 year average.

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Baker Hughes Rotary Rig Count

Drilling Rig Update:  Active rig count released by Baker and Hughes for week ending Nov 25, 2009 was 748 rigs. That is an increase of 22 rigs. The rig count is still 763 lower than the count reported this same week last year. We are 42% below the 5-year avg. rig count of 1,286.

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NYMEX Natural Gas Monthly Settlements
(Price per therm at the well-head)

Jan-09

$0.6136

May-09 

$0.3321

Sept-09 

$0.2843

Feb-09

$0.4476

Jun-09 

$0.3538 

Oct-09 

$0.3730

Mar-09 

$0.4056

July-09  

$0.3939

Nov-09 

$0.4289

Apr-09 

$0.3631

Aug-09 

$0.3379

Dec-09 

$0.4486

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NYMEX Values: Thursday, December 3, 2009
(Price per therm at the well-head)

Jan-10

$0.4459

Jun-10

$0.4784

Nov -10

$0.5633

Feb-10

$0.4548

July-10

$0.4882

Dec-10

$0.6083

Mar-10

$0.4586

Aug-10

$0.4961

12-month

$0.4953

Apr-10

$0.4632

Sept-10

$0.5016

12/09-3/10

$0.46057

May-10

$0.4693

Oct-10

$0.5158

Crude oil

$76/bl.

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NYMEX 12-Mo. Avg. Price Per Therm at the Well-Head
(excludes Interstate Transportation)

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PJM Electricity
PJM 12-Month Average Peak Power Price
On-Peak 1 Year Forward Price

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Weather
Local Heating Degree Days*

 

Local Cooling Degree Days* 

 

Nov-09

 

 

 

 Actual

376

  

 

 

        

 Normal

477

  

 

 

 

 Departure from Normal

21.2%

 

 

 

Warmer

           

           

           

          

          

 

* * Heating degree days are calculated by comparing the day’s average temperature to a 65 degree baseline.  If the day’s average temperature is above 65, there are no heating degree days that day.  If the day’s average temperature is less than 65 degrees, subtract the day’s average temperature from 65 to find the number of heating degree days for that day.

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