Natural Gas & Oil
May '26 Trading range today: $2.57 to $2.62.
- Natgas prices remain bearish as HDDs leave the season early.
- Mild weather is also allowing key US regions to inject above-average injections into storage.
- Domestic natgas prices remain heavily insulated from Middle east supply risks as domestic record production continues.
- An increase in oil production is producing additional natgas in the Texas markets, a lot of it being flared due to capacity constraints.
- Japan pledges $10BB to help SE Asia nations procure crude during the supply shock.
LNG
- LNG exports will increase as more terminals open in Q3 and Q4, but traders have already factored this additional export into forward curves.
- LNG Exports in March '26 are 37% above March 2025 exports.
Power
- EIA expects solar generation this summer to increase by 17% over 2025 summer generation levels.
- Coal generation for power is expected to fall by 10% for the first half of 2026 compared to 2025.
- Mild weather compared to this time last year is keeping power prices bearish and below last year's prices.
Today's Drivers
The Bears – ($2.60 to $1.90 range) – Record production, shoulder season dropping demand, storage expected to see above average injections over the next month.
The Bulls – ($2.95 to $3.25 range) – LNG exports remain strong, summer CDDs grabbing attention, long term structural tightening.
Today's Special – Seasonal changes
- Soft Spring - Storage is building, demand is down, supply is ample, prices fall.
- Summer Heats Up – storage injections are limited, demand increases, supply tightens.
- Early Winter – demand increases, withdrawal season begins earlier than usual, less solar, prices increase.
Our Nightcap Beats Their Recap