Natural Gas & Oil
May '26 Trading range today: $2.48 to $2.55.
The fact that numerous fund managers have UNG listed as a "buy" should tell us gas prices are expected to increase significantly.
UNG has mirrored gas prices, currently down by over 50% from 1 year ago.
UAE announced today it is leaving OPEC, delivering a heavy blow to the once prominent cartel, and setting themselves up with more options than ever in terms of shipping options.
LNG
Current exports running 20% above this time last year with more terminals opening soon!
Power
Someone recently claimed to us that California solar will save the state from high energy prices and all is fine.
That claim is wildly inaccurate, and we'll explain why it's inaccurate all week long, starting with the duck curve below.
Today's Drivers
The Bears – ($2.60 to $1.90 range) – strong production, strong injections, RE contributing.
The Bulls – ($2.95 to $3.25 range) – LNG exports increasing, demand already increasing.
Today's Special – California Duck Curve
The duck curve takes place in the power sector when you add a lot of solar to the grid - the price curve is shaped like a duck.
- Morning demand is up as it waits for sun to come up – the tail.
- Alternate power demand drops midday solar floods the market – the belly.
- Evening arrives, sun goes down, solar fades, forcing the grid to ramp up with other power generation – the neck.
The demand doesn't change, the net load (total demand minus RE generation) changes.
Prices spike due to the swift upturn (the neck/head of the duck), causing grid strain.
Power markets are no longer smooth, gas demand spikes and increases in value for specific hours, leaving the evening to be traded heavily at higher profits, leaving you with higher prices to pay.
Our Nightcap Beats Their Recap