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Washingto Gas Energy Services: A Washington Gas Affiliate Complany
Volume 9, Issue 28
We know how to deliver energy.
July 16, 2010 Energy Update
In this Issue
Editors Note
Week in review for period of July 9, 2010 to July 16, 2010.
Natural Gas
EIA Gas Storage Update
Baker Hughes Rotary Rig Count
NYMEX Natural Gas Monthly Settlements
NYMEX Values: Thursday, July 15, 2010
NYMEX 12-Mo. Avg. Price Per Therm at the Well-Head
PJM Electricity
PJM 12-Month Average Peak Power Price
Weather
Local Cooling Degree Days*
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Editors Note
Week in review for period of July 9, 2010 to July 16, 2010.

Energy prices fell during the first few days of the week but spiked upward at the end of the week. As a result, energy prices closed this week looking very similar to last week’s prices. For this report period, the 12 month average price for natural gas at the well-head rose .5%, and the average 12 month price for peak power on the PJM rose .2%.  Factors that contributed to the early week price declines included high storage levels and continued strong domestic natural gas production. (Current gas production is 3% higher than last year’s production levels.) However prices fell at the end of the week as forecasters called for the onset of brutally hot temperatures. Hot temperatures create a surge in gas demand as gas powered generators will ramp up to meet air-conditioning needs. Weather will continue to be a huge wild card for the next two months. With prices still low relative to the last 5 years, this is a great time to look at an early renewal strategy.

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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

2,840

2,762

 78

2,873

2,566

Storage Update:  This week’s net injection of 78 Bcf was lower than expected and increased our deficit from last year. We are 1.1% below last year’s levels. However, inventories are 10.7% above the 5 year average.

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Baker Hughes Rotary Rig Count

Weekly Drilling Rig Update:  Active rig count released by Baker and Hughes for week ending 7/9/10 was 964 rigs which was a net increase of 4 rigs.  The rig count is 292 higher than the rig count reported this same week last year. However, we are now 24% below the 5 year average rig count of 1,261.

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

Aug-10

$0.4548

Dec-10

$0.5239

Apr-11

$0.5074

Sept-10

$0.4587

Jan-11

$0.5427

May-11

$0.5093

Oct-10

$0.4673

Feb-11

$0.5384

June-11

$0.5144

Nov-10

$0.4944

Mar-11

$0.5291

July-11 

$0.5206

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NYMEX Values: Thursday, July 15, 2010
(Price per therm at the well-head)

Aug-10

$0.4586

Jan-11

$0.5322

June-11

$0.5086

Sept-10

$0.4592

Feb-11

$0.5294

July-11

$0.5143

Oct-10

$0.465

Mar-11

$0.5202

12-month

$0.4997

Nov-10

$0.4893

Apr-11

$0.5017

11/10-3/11

$0.5170

Dec-10

$0.5141

May-11

$0.5037

 Crude Oil

$76/barrel 

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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 Cooling Degree Days*

 

Local Cooling Degree Days* 

 

May-10

Jun-10

Jul-10

Aug-10

Sep-10

Oct-10

 Actual

201

473 

 

 

 

 

 Normal

107

 304

  

 

 

 

 Departure from Normal

47.0%

 35.7%

 

 

 

 

Warmer

 Warmer

 

 

 

 

 

**Cooling degree days are calculated by comparing the day’s average temperature to a 65 degree baseline.  If the average temperature is below 65, there are no cooling degree days that day.  If the average temperature is greater than 65 degrees, then subtract 65 from the average temperature to find the number of cooling degree day

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