The news stories for this seven day report period were very bearish and placed downard pressure on energy prices across the board. The 12-month average price for natural gas at the Henry Hub well-head fell 4.4%. Natural gas has now dropped 10% in three weeks. The trading prices for peak power on the PJM electricity grid fell 2%. Crude oil prcies fell from $95/barrel to $91/barrel.
Numerous energy related stories hit the wire this week and placed downward pressure on prices. On the natural gas front we finally experienced an above average injection of natural gas into storage. This week's injection of 98 Bcf was 14% above the 5 year average injection of 86 Bcf. This larger than expected injection placed downward pressure on energy prices.
On the crude oil front the International Energy Agency (IEA) surprised the energy markets by announcing the release of 60 milion barrells of oil from the Strategic Petroleum Reserves of 28 nations. (Note: 30 million of the 60 million barrels is coming from the Unites States.) This crude oil release was an international effort to offset the lack of oil coming out of Libya. In the short run, this announcement placed downward pressure on prices.
Lastly, the lack of summer heat this week coupled with somber economic news kept energy prices low this week. But do not be lulled to sleep. Energy markets are very fickle. All the Bulls need is a heat wave or a tropical disturbance in the Atlantic basin and prices will reverse direction.