The Shipley Energy Commercial Solutions market update is an exclusive service provided to our customers. Designed to help keep you informed, it provides expert insights from our team on trends, weather, and other factors impacting the market.
Down we go! The PJM forward 12-month curve has now touched down at 2.90 cents per kWh, which is now the lowest point of at least the last 4 years. If you use more than 300,000 kWh annually and your current contract expires before July 2020, now is the time.
Even if your contract expires more than a year from now, you may want to consider layering in a portion of your energy, or setting a PriceObjective to beat your current rate by 10 percent or more. Though the temptation to put this off can be strong, remember you can lock in a future start at any time and provide a financial gift to future fiscal years. Customers should at least be having strategic conversations about how they’d like to respond to extreme market dips this far in advance.
Natural gas Nymex pricing has been continuously trending downward in recent weeks, with market prices through December 2020 all sitting below $2.80. Market prices have reached the current lows based on relatively cool temperatures nationwide and gas production well out-pacing demand. Several northeast basis points have seen elevated prices recently with gas being flowed into areas of higher demand, particularly the southeastern part of the country.
Action Advice: Customers with basis only deals should consider buying winter Nymex (Nov-Mar) to lock in current gas market prices which are the lowest since spring of 2016.
Philadelphia Energy Solutions and Mayor Kenney of Philadelphia have announced the closure of its 335k barrel per day refinery in the wake of the explosion and fire last week at the facility. The immediate impact on Pennsylvania and Mid-Atlantic region has been swift with gasoline futures rising ten cents and diesel adding five cents post announcement.
The refinery is the largest on the East Coast and tenth largest in the country. The immediate impact will be supply shortages of gasoline and distillates as regional sources of supply and logistics are assessed. This comes at an inopportune time for the region, entering the peak summer months with a strong rebound in gasoline and diesel demand.
Looking for more insights and information? We’re here to help. Call 717-771-0772 or email us to speak with the Client Services team.
Disclaimer: This report 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 this report.