| Week Beginning August 1, 2022Europe is facing a potential natural gas crisis this winter, due to the sanctions placed on Russia. Last week, Gazprom slashed natural gas deliveries through its pipeline to just 20% capacity, citing maintenance work. Looking for new ways to conserve energy, one city in Germany banned hot water in public buildings, like government facilities, gyms, and swimming pools. The city of Hanover will also reduce heating in public buildings, disconnect public fountains, and discontinue lighting up buildings at night. “The goal is to reduce our energy consumption by 15%,” said Mayor Belit Onay. “This is a response to the looming gas shortage, which is a big challenge for municipalities — especially for a big city like Hanover.” Germany gets over half of its natural gas supply from Russia. |
| Crude prices have been falling in recent weeks, but demand is rising again as other countries are looking to replace crude they were receiving from Russia, which means prices could be trending upward as the month moves on. The average for a gallon of regular gasoline in the United States was down about 14 cents last week from $4.355 to $4.212. The average price in New York was $4.516, and Pennsylvania was averaging $4.468 per gallon last week. New Jersey was seeing an average of $4.392, and Maryland had an average of $4.183. Diesel prices dropped again last week, too. Across the United States, a gallon of diesel was averaging $5.279 this week, down from $5.421 the previous week. As for propane, prices in New York were down slightly from $3.57 per gallon to $3.52 per gallon this week. |
| NYMEX 12-month strip prices dropped $0.03/dth on the week, the first price decrease in four weeks. Most of the supply/demand factors known for the last few weeks are generally still in place, but the market, at least for this week, thought the 40% NYMEX strip price increase this month was enough. On the supply side, production is bouncing around 96-97 Bcf/day, but continues to struggle to stay over that 97 Bcf/day level. Storage levels also are struggling, and are still 12% below the five-year average. On the demand side, domestic demand remains strong along with ongoing LNG demand. The U.S. was the largest LNG exporter in the world in the first half of 2022. Looking ahead, the market will continue to focus on factors, such as storage, as we get later in the summer. The forecasted injection this week is 27 Bcf, larger than the five-year average, but a number that would not lower the current deficit to the five-year average much at all. |
| Power forwards were volatile again every day last week, with forwards gaining $1/MWh for the 12-month strip. NYISO UCAP saw some significant gains for the remainder of the Summer 2022 period, but very little change beyond that. PJM RECs saw a 5% increase for Class 1 RECs. |
| According to the International Energy Agency, the sale of electric vehicles has tripled in the last two years. If you haven’t thought about adding an EV charging station to your property or business, now might be the time. Reach out to an Energy Advisor to learn more about the benefits of an EV charging station, and possible government incentives to help offset the cost. Read our latest blog to learn more about how quickly the sales of EVs are rising. |