Need a different solution?
We’re here to help!
Our team is here to help!
Deliveries you can count on!
The Shipley Energy Commercial Solutions Team is excited to share the June Energy Market Update to inform you of trends, weather, and other factors impacting the energy market.
Read the May 2025 Energy Market Update ->
Skip to:
Gasoline and diesel demand dynamics significantly influenced the crude oil and refined products market as June began, following two weeks of declines. WTI surged over 6% to settle at $64.58 per barrel, its highest since April 17, driven by a “risk-on” sentiment from geopolitical developments and a robust U.S. jobs report. However, weak demand signals—gasoline consumption down 12.6% to 8.263 million barrels per day (b/d) and distillate demand off 19% to 3.151 million b/d—tempered optimism. July became the prompt month for gasoline and diesel, and backwardation persisted with the WTI July/August spread near $1/bbl, though contango is expected later in 2025 due to anticipated OPEC+ supply increases. Simply, contango may emerge if near term supply is perceived to be ample putting downward pressure on the near end of the curve while the backend prices remain higher than the near term prices.
Last week the EIA reported significant inventory builds, with gasoline stocks rising 5.2 million barrels and distillate inventories up 4.2 million barrels, the largest weekly increase since January. This surplus, particularly on the East Coast where gasoline stocks climbed 3.4 million barrels to exceed 2023 and 2024 levels, pressured RBOB futures, which dropped nearly 5 cents. Refinery runs reached 93.4% capacity, processing 17.192 million b/d, but gasoline production fell to an eight-week low of 9.326 million b/d, while distillate output increased. Weak demand continues to challenge refining margins, raising concerns about profitability as the summer driving season approaches, with next week’s data pivotal for market direction.
The overly bearish crude production sentiment overhang from OPEC remains as they could simply send the whole energy market into a tailspin at the drop of one production increase headline. Energy prices stabilized last week after OPEC decided to keep next month’s production quota the same as the month prior. If for any reason OPEC wants to engage in a market share price war, they could easily by signaling a larger than expected monthly production increase. For this reason, bullish sentiment has seemingly vanished from the market in aggregate, thus keeping a lid on upward gasoline and distillate prices. Strong short covering rallies can be expected in this environment, but until Fed Fund interest rates are cut, significant trade deals are met, and sustained manufacturing expansion, price rallies may be limited.
Thanks to a generally mild May, we saw prices fall throughout the month. The 12-month electricity price at the start of the month was $48.45/MWh in Ohio and was down to $46.61/MWh by the end of the month. In PA, it decreased from $52.52/MWh to $50.37. Looking at longer terms there was less movement, the 36-month strip in OH fell $0.53 to end the month at $47.50. PA was similar with a decrease of $0.38 to end at $52.19. We’re now into the higher capacity rates in PJM (started 6/1/2025). For many customers this will make up a substantial portion of their all-in price and is not going to decrease for at least the next 12 months. We saw volatility start to subside from April, but with so much uncertainty in the broader energy market, don’t expect this to continue for long.
We continue to see market fundamentals that are worrisome for energy buyers:
The wholesale energy markets watch these factors, and changes can push prices up or down on a daily basis. Based on where we stand now, we recommend evaluating these strategies:
Your to-do list for May and heading into summer:
Want to help your business navigate the current market? Get started with your Shipley Energy Advisor today!
Due to the volatility, we recommend checking in frequently with your account manager for daily changes to the market and opportunities to lock in during sell-offs.
Other rate options include Basis Only or NYMEX Lock deals to separate the two elements of your natural gas supply price to look for potential value vs standard Fixed pricing. For those who want to float their NYMEX, consider a cap and floor structure to economically manage your risk. Ask your Account Manager for details.
June 2025 Natural Gas NYMEX Settlement Price: $3.204/MMBtu
Last month: May 2025 Natural Gas NYMEX Settlement Price: $3.170/MMBtu
Last year: June 2024 Natural Gas NYMEX Settlement Price: $2.493/MMBtu
Disclaimer: The market update is intended solely for informational purposes only. Shipley Energy Company does not warrant or attest to its accuracy. All actions and judgments taken in response to this report are the recipient’s sole responsibility. Shipley Energy Company shall not be liable for any direct, indirect, incidental, consequential, special, or exemplary damages or lost profit resulting from these market updates.
