Natural Gas Storage and Supply
- The Injection of +77 reported on October 30th, is the first injection in a few months clearly above the five-year-average and last years injection.
- The next EIA Gas Storage Report, which will come out on Thursday the 12th will be the first gas storage report of the withdrawal season which began on November 1st. However, with the weather being as warm as it has been we could still see injections for the next few weeks.
- We are expecting a near or even new record for warmer temps in November this year which should help pricing for this winter as natural gas storage continues to build up.
What to Do Now
- If you are using more than a million kWh annually, talk to your energy advisor about moving to a Load Following Index strategy or Managed Index strategy. This strategy allows you to buy blocks of energy when it is favorable and let the rest stay on the Day Ahead index rate. This is an excellent strategy that eliminates the premiums suppliers often place on the components of your electricity rate when they must fix it.
- Look at longer term agreements to allow you take advantage of lower blocks of energy in the future. 2029 is currently priced below market expectations. You may want to think about locking up 50-75% of the off-peak months or even locking up 75% of all but Winter 2029. It might be advisable to also hedge 25% of the coming January & February right now and then look at it again just before Thanksgiving. If it remains this low, look at locking up another 50%.One winter event can ruin pricing for the winter. Last winter saw mild temperatures in December, but a cold front that kept temperatures below freezing for much of the PJM Electric Grid for 15 days straight in late January early February sent pricing over $120.00 per MWh. Hedging 25-75% of next winter helps mitigate any random weather events as well as taking advantage of some low pricing currently available.
- Natural Gas users should be on what is called a NYMEX+ strategy. This generally provides greater savings than a fixed all-in contract. A NYMEX+ strategy takes an ‘adder’ that covers the suppliers’ costs for storage and the cost of doing business in that utility and adds it to the NYMEX settlement price for that month. So, if you have an ‘adder’ of $0.75 cents per Mcf and place that upon last years NYMEX Settlement price of $3.004, you will have a rate of $3.754 for that month. Much better when you consider fixed pricing for gas currently does not go below $4.50 per Mcf.
NYMEX Natural Gas Calendar Strips
- The 2026 Calendar Strip has remained low in large part due to the onset of the El Nino in May.
- Gas pricing for 2027 has cratered in the last week or so with even Winter 2027 topping out at $3.59 for January.
- Pricing in later years has begun to diverge from 2026 and 2027 as 2028, 2029 and 2030 have begun to cycle upward closer to $3.75
Natural Gas Production: Lower 48 States
Production Snapshot
The pricing for the 12-month strip and for 2027 continue to cycle lower with pricing hovering right around $3.00. While this winter is seeing lower pricing, 2028, 2029 and 2030 are all trending higher. This should prompt buyers to lock in now for as long as possible.
- Natural Gas Production stayed unchanged from last week at 111.6 Bcf/d
- While production has been historically high in recent weeks, production will still have to increase to meet the demand that will be caused by the opening of more LNG Export facilities over the next few years.
- Our LNG exports have increased by roughly 15 Bcf/d in the last ten years, excluding 2020 when the pandemic cratered demand. Our production has increased from 77.5 Bcf/d in 2016 to about 108 Bcf/d, an increase of 30 Bcf/d.
Weather Outlook
Energy Usage Reductions
Through tailored efficiency evaluations, the energy program helps members identify practical equipment and power upgrades to reduce operating costs. Ampica supports each project with objective planning, vendor coordination, and strategies aligned with your operation’s seasonal needs.
7-Day Weather & Demand Outlook
The Cold Front will have moved through by the end of next week and warmer than normal temperatures will settle into the Eastern half of the United States while cooler, wetter weather will settle in the Western half.
PJM Ad Hub DA & Forward Trend Analysis
This chart shows where current PJM AD Hub day‑ahead and forward power prices sit versus the past two years of trading, and whether today’s levels look cheap or expensive for each future period.
Big picture
- Each bar represents a 24‑month trading range for a specific month, quarter, or year in the future, with the light blue band showing the lowest and highest prices over the last 2 years.
- The dark mark inside each bar is today’s forward price, so you can instantly see if the market is currently near the top, middle, or bottom of its recent range.
What the table tells you
The table underneath lists, for each period (Q2‑2026, Q3‑2026, 2027, 2028, 2029, 2030, etc.):
- September and October turned out to be higher than thought earlier in the year with both months averaging above $60 per MWh. November has settled down with decreased demand and is now below $50.00
- The 2029 opportunities we have recommended are beginning to disappear. Hedging 75% in March-June 2029 is still a viable option, but September through November is already back over $50.00.
- When looking at electricity hedges, locking up at least 50-75% of 2029, except for July and January, February is a good strategy.
How to interpret it for decisions
- Periods where the current price is low on the bar and at a low percentile suggest relatively attractive buying or hedging opportunities compared with recent history.
- Periods where the current price is high on the bar and at a high percentile indicate the market is pricing that future strip richly, so you may want to be more cautious about locking in too much volume there.
NOAA NOVEMBER TEMPERATURE OUTLOOK
Warmer than normal temps will occupy much of the Northern United States in November with normal temps in the Southwest. This could result in a near record warm November for the U.S.
Ampica Advise: The Demand-Side Advantage
Energy procurement matters—but reducing consumption is just as important. Even the best electricity rate can be outweighed by unnecessary energy use from inefficient HVAC equipment, aging lighting, or other avoidable facility loads.
“The cheapest electricity you have is the electricity you don’t use.”
Talk with an Ampica energy expert about a complimentary facility site audit. We can help identify practical energy-efficiency opportunities that reduce usage, control costs, and strengthen your long-term energy strategy.
