The picture below is of the 2020 Honda Clarity, a hydrogen fuel cell vehicle, (FCV) which will be available soon in California. Leasing will be available from $379/mo for 36 months ($2,878 due at signing) with an available $5,000 rebate for California customers. The car has a mileage allowance of 20,000 miles per year. It also comes with up to $15,000 of hydrogen fuel, in addition to the round-the-clock roadside assistance.


Natural Gas in Underground Storage

The weekly EIA Natural Gas Storage Report advised today that there was an injection of 70Bcf into Underground Storage for the week ending 4/24/20.

This is 1Bcf above the forecast of a 69Bcf injection, the average prediction of sector analysts and traders in the Dow Jones Newswires weekly survey. This compares with an injection of 114Bcf last year and a 74Bcf build for the five-year average. Storage is 783Bcf above last year for the same week and 360Bcf above the 5-year average. Working gas in storage stands at 2,210Bcf. Annual storage "surplus" is currently projected to shrink by 34 Bcf by May 29.

*As many as 25 liquefied natural gas (LNG) cargoes originally scheduled for June loading from U.S. facilities likely have been canceled, as European and northeast Asian spot prices have dropped to all-time lows (Read More ...)

Natural Gas Pricing


As of 9:45AM CST, June 2020, (the new prompt month) Natural Gas was trading at $1.88, -$0.04 from one week ago and the 1-Year Spread average was $2.56, +$0.02 from one week ago. The May 2020 Natural Gas contract closed at $1.79.

Crude Oil Pricing


As of 9:32AM CST, June, 2020, (the new prompt month) Light, Sweet Crude on the NYMEX was at $17.62, +$0.69 from one week ago.

Crude Oil Inventory


US crude inventories (EIA) increased by 9.0 million barrels to 527.6 million for the week ended April 14th, according to data released yesterday morning by the US Dept of Energy. Traders in the Reuters poll projected an increase of 10.6 million barrels.

U.S. Rotary Rigs


According to the Baker Hughes Count, US Rotary Rigs targeting Natural Gas were -4 at 85 for the week ending April 24th and -101 from last year.

Rigs targeting Crude were -60 at 378. There are 427 fewer rigs targeting oil than last year. Canadian Rigs were -4 at 26 and -37 from last year. US Rigs drilling for oil drop 2% to  81% of all drilling activity.

Geopolitical


After a turbulent week in the oil markets, rougher waters may lie ahead. A flotilla of about 20 Saudi Arabian supertankers carrying more than 40 million barrels of crude oil is sailing to the Gulf of Mexico and is set to arrive in May. The timing and optics couldn’t be worse. With the U.S. oil industry running out of places to store production and prices down sharply this year, the White House is under growing pressure from Republicans to stop the tankers from unloading and adding to the flood.

Citing falling oil prices and mounting job losses, Sen. Ted Cruz (R-Tex.) said in a recent tweet: “My message to the Saudis: TURN THE TANKERS THE HELL AROUND.”

The United States routinely imports small amounts of Saudi oil, which helps U.S. refiners optimize their facilities for different grades of oil. But the new wave of tankers from the Saudi kingdom will arrive as President Trump is being pressed to do something to aid U.S. oil and gas companies and help navigate an oil glut caused by the coronavirus.

Treasury Secretary Steven Mnuchin said on Sunday that the Trump administration is considering government loans to help out the industry, raising the possibility of taking an extreme step to try to limit more economic damage. On Monday morning, however, the price of U.S. benchmark West Texas Intermediate oil dropped by more than 25 percent.
And the oversupply is bound to increase, even after Russia and the Organization of the Petroleum (Read More ...)

Weather


The AccuWeather 1-5 Day Outlook forecasts above-normal temps for the Western 3/5 of the US, and most of the Northeast. The  balance of the country is projected to be at at normal temps. 

The 6-10 Day Outlook forecasts above-normal temps for the Western third of the US and all of Texas, as well as all states bordering the Gulf of Mexico. The Northeast quarter of the country is projected to be at below-normal temps, with the balance of the country at normal temps.

The 11-15 Day Outlook forecasts above-normal temps for the Western third of the US and South Florida. The Northeast quarter of the country is projected to be at below-normal temps, with the balance of the country at normal temps.

The 30-Day Outlook shows above-normal temps for most of the Western quarter of the US, West Texas, Florida, Georgia and the Carolinas, with the rest of the US at normal temps.

The 90-Day Outlook shows above-normal temps for the Western quarter of the US, as well as West Texas, New Mexico, Florida and the Carolinas. The balance of the country is projected to be at normal temps. 

Severe Weather: Very little precipitation is forecast for the next week in the US. There will be some rain in the Northwest and East Coast over the next few days but less that 1" is projected.
(Read More ...)

Sustainable and Renewable Energy  


Climate change: 'Bath sponge' breakthrough could boost cleaner cars: A new material developed by scientists could give a significant boost to a new generation of hydrogen-powered cars. Like a bath sponge, the product is able to hold and release large quantities of the gas at lower pressure and cost.

Containing billions of tiny pores, a single gram of the new aluminium-based material has a surface area the size of a football pitch. The authors say it can store the large volume of gas needed for practical travel without needing expensive tanks.
 
• Behind the wheel of a hydrogen-powered car
• The engineer powering drones with a 'happy gas'
• Climate change hope for hydrogen fuel

Car sales, especially larger SUVs, have boomed in the US over the past number of years. In 2017, CO2 emissions from cars, trucks, airplanes and trains, overtook power plants as the largest source of US greenhouse gas emissions. As well as developing electric vehicles, much focus has been on hydrogen as a zero emissions source of power for cars.

The gas is used to power a fuel cell in cars and trucks, and if it is produced using renewable energy it is a much greener fuel. However, hydrogen vehicles suffer from some drawbacks. The gas is extremely light: in normal atmospheric pressure, to carry 1kg, (2.2lbs) of hydrogen which might power your car for over 100km, (62 miles), you'd need a tank capable of holding around 11,000 litres, (2,905 gallons).

To get around this problem, the gas is stored at high pressure, around 700 bar, (10,152 psi) so cars can carry 4-5kg, (1-1.3 gallons) of the gas and travel up to 500km, (310 miles) before refilling. That level of pressure is around 300 times greater than in a car's tires, and necessitates specially made tanks, all of which add to the cost of the vehicles.

Now, researchers believe they have developed an alternative method that would allow the storage of high volumes of hydrogen under much lower pressure. The team has designed a highly porous new material, described as a metal-organic framework (Read More ...)

This Week's Key Take-Away


Where is Natural Gas headed? Once the pandemic situation normalizes and COVID-19 adjustments are removed, EIA storage will drop as a result of more demand and less production. We are constantly monitoring the latest production trends and we are adjusting our storage forecast accordingly. In general, natural gas production is projected to decline for two key reasons:

1. Productivity of new wells has plateaued, while the inventory of old wells is now growing faster than the inventory of new wells.
2. The collapse in oil prices is prompting companies to deepen spending cuts and reduce future output.

So far, however, dry gas production has been mostly flat for the past three months. It is trending down, but very slowly. More production cuts are needed to bring the EOS storage index down. Today's early morning pipeline nominations (a proxy for production) edged up, while yesterday's nominations were revised higher, but only slightly.

We believe that dry gas production in the U.S. should continue to decrease, and we actually think that in the very short term, we might see a major drop in net-supply.

Next week (ending May 8), the weather conditions are expected to get significantly warmer. The number of (Heating Degree Days) HDDs is, currently, projected to drop by 8% w-o-w (from 48 to 44), while the number of (Cooling Degree Days) CDDs should jump by a whopping 53% w-o-w (from 21 to 31). Total energy demand (measured in TDDs) should rise by 24% y-o-y, while the deviation from the norm will increase to +17.4%.

Moody’s said U.S. natural gas oversupply will gradually taper off through 2021, as key producers scale back capital investment and production this year and next -- primarily in Appalachia, North America's largest producing region, where reductions are already underway.

With the US projected to come back online over the next few months, expect to see Natural Gas prices rise with demand increase and less available Natural Gas. Of course,the volatility due to uncertainty of the course the Coronavirus will take could change the outlook quickly.



Copyright © 2020 Utility Revenue Services, LLC. All rights reserved. Reproduction of this information is prohibited without express written permission.