Western energy prices continued to plummet, depressed by a lack of cold weather across most of the continental United States.
The benchmark Henry Hub on Jan. 22 posted its lowest January price in more than 20 years, according to the U.S. Energy Information Administration, when it dropped to $1.89/MMBtu. This is the lowest January price for the hub since 1999.
The agency attributed the drop to "generally warmer than normal" conditions for most of the country, save for the Northeast and Midwest.
California experienced "more temperate weather" that "eased" net withdrawals from storage, according to the EIA. Energy GPS analysts note this weather pattern "has been locked in since early December 2019" and add that January "is going to go down as one of the warmest ones in recent history."
In Jan. 16 to Jan. 23 trading, SoCal CityGate natural gas posted the greatest loss among Western hubs, falling $1.33 to $2.82/MMBtu. PG&E CityGate was the only other Western hub that managed to trade above the $2 mark, at $2.71/MMBtu after shedding 18 cents.
Western natural gas prices generally fell by between 12 cents and as much as $1.33 in trading; however, El Paso-Permian natural gas was the exception, adding 12 cents to reach 88 cents/MMBtu.
National working natural gas in storage was 2,947 Bcf as of Jan. 17, according to the EIA. This is a net decrease of 92 Bcf compared with the previous week.
Natural gas demand nationwide increased 17 percent week over week. Natural gas use for power generation jumped by 15 percent week over week, which was attributed to demand for electricity used for space heating.
Energy GPS, in the same Jan. 23 note, said that until the weather changes, "the production numbers are going to be drowning the natural gas supply/demand balance equation."
A total of 1.007 Bcf was withdrawn from Aliso Canyon on the gas days between Jan. 16 and Jan. 21, according to ENVOY reports. A "gas day" spans 7 a.m. to 7 p.m.
Western power prices also tumbled between $4.75 and $12.55 in trading. Mid-Columbia peak power lost the most value in trading, falling $12.55 to $17.90/MWh. By Jan. 23, prices ranged from $15/MWh at Palo Verde to $30.25/MWh at North of Path 15.
Markets were closed Jan. 20 in observance of Martin Luther King Jr. Day.
Nighttime power prices also trended lower. Mid-C off-peak power lost the most, dropping $7.90 to $15.65/MWh. At the end of trading, prices ranged from $15.65 at Mid-C to $27.25/MWh at NP15.
California ISO demand reached 28,106 MW Jan. 20, which should be the week's high. Renewable resources met 10,197 MW, or roughly 37 percent of demand, Jan. 22.