Print

Weekly Energy Industry Summary

Commodity Fundamentals

Week of May 12, 2025

By The Numbers:

  • NG '25 prompt-month NYMEX settled at $3.65per MMbtu, down $.15/MMbtu, on Monday, May 12.
  • WTI '25 prompt-month crude oil settled at $61.95 per barrel, up $.93 per barrel on Monday, May 12.

Natural Gas Fundamentals - Neutral/Bearish

  • Prompt NYMEX natural gas settled at $3.65 per MMbtu, down $.15/MMbtu on Monday, May 12.
  • A warm-up in the Midwest and East will peak on Friday and give way to milder air in the 16-day outlook. The West and Southwest will be hot.
  • Several 100 plus Bcf storage injections are forecast in the next three weeks tempering the gas market.  
  • Residential/commercial demand for natural gas year-to-date averaged 33.3 Bcf per day versus 21.5 Bcf per day for the same period last year. 
  • Gas demand for power generation averaged 31.9 Bcf per day, year-to-date, versus 30.1 Bcf per day for the same period last year.
  • LNG exports averaged 15.4 Bcf per day year-to-date versus 12.5 Bcf per day for the same period last year.
  • Exports to Mexico averaged 6.2 Bcf per day year-to-date versus 6.0 Bcf per day for the same period last year.

Crude Oil - Neutral

  • NYMEX (WTI) prompt-month crude settled at $61.95/bbl, up $.93 per barrel.
  • Demand outlooks have been soft pursuant to Trump Administration tariff issues.
  • President Trump is meeting with the Crowned Prince of Saudi Arabia today.
  • The Saudi's have been jawboning the idea that they are releasing more oil into the market as a means of instilling OPEC producer discipline.  However, the real reason is likely a cooperative move with the Trump Administration; more oil and lower prices in exchange for more military support and a commitment by the U.S. to box in Iran, Saudi Arabia's primary adversary.
  • Watch for a major commitment by the U.S. for the sale of arms to the Saudi's.
  • Tariff talks with China took a big turn yesterday as Trump announced a lowering of rates for a period of 90 days -- oil markets responded to the upside.

Economy - Neutral

  • April's annual inflation cooled to 2.3%, the lowest since February 2021.
  • A decline in gasoline prices versus a year earlier helped pull the rate lower.
  • Prices excluding food and energy -- the so-called core measure that economists watch -- rose by 2.8%, matching forecasts, The Wall Street Journal reported.
  • Equities markets moved up sharply yesterday in response to Trump's announced pause in the tariff war with China.
  • The spring housing market is a "dud" according to the Wall Street Journal.  
  • Home sales fell 5.9% in March, the biggest drop since 2022.
  • Jobless claims fell last week. The Labor Department said Thursday that 228,000 new jobless claims were filed, down from 241,000 a week earlier.

Weather - Neutral

  • Warmer temperatures in the East and Midwest will peak on Friday, then give way to milder air in the 16-day outlook.
  • It will be seasonal in the Southeast.
  • It will be hot in the West and Southwest.

Weekly Natural Gas Report:

 
  • Inventories of natural gas in underground storage for the week ending May 2, 2025 are 2,145 Bcf; an injection of 104 Bcf was reported for the week ending May 2, 2025.
  • Gas inventories are 30 Bcf above the five-year average and 412 Bcf less than the same time last year. 
Values reflect week ending May 9, 2025
Prices reflect week ending May 9, 2025

Weekly Power Report:

Mid-Atlantic Electric Summary

  • The Mid-Atlantic Region’s forward power prices were supported last week with natural gas prices, as forecasts for a warmer than normal summer along with an announced relaxing of tariffs with China provided an uplift for commodities during that time.  June natural gas futures charged higher on Friday driven by outlooks for rising LNG and utility demand as National Oceanic and Atmospheric Administration (NOAA) expects a warmer-than-normal summer.  Natural gas prices started higher on Monday, but then swung lower, as strong natural gas production numbers offset some of the increases in demand due to the weather projections for this week.  A trough digging into the West will bring a ridge downstream over the eastern half of the nation. This brings cooler-than-normal weather to the West, with above to much above normal temperatures over the eastern two-thirds of the nation with early-season heat in the South.  Power price futures for the 2026-2030 terms were 1% higher over the past week and 5% higher over the past month.  The month-to-date, day-ahead settlement price in West Hub is currently averaging $37.93/MWh, which is -18% lower than April’s final average settlement price, but 15% higher than May of 2024.
  • PJM Provides More Information About the Reliability Resource Projects - On 5/2, PJM released summary information about the projects selected for expedited interconnection in the Reliability Resource Initiative (RRI), a one-time insertion of qualifying projects into a 14-month earlier phase of the interconnection queue.  Data was shared by PJM on 5/5, detailing the 97 projects submitted and 51 projects accepted into RRI.  In-Service Dates range from 12/31/23-12/31/31 with a majority of the MWs coming online in 2029/2030 and 2030/2031.

Great Lakes Electric Summary

  • The Great Lakes Region’s forward power prices were supported last week with natural gas prices, as forecasts for a warmer than normal summer along with an announced relaxing of tariffs with China provided an uplift for commodities during that time.  June natural gas futures charged higher on Friday driven by outlooks for rising LNG and utility demand as National Oceanic and Atmospheric Administration (NOAA) expects a warmer-than-normal summer.  Natural gas prices started higher on Monday, but then swung lower, as strong natural gas production numbers offset the demand increases expected due to the weather projections for this week.  A trough digging into the West will bring a ridge downstream over the eastern half of the nation. This brings cooler-than-normal weather to the West, with above to much above normal temperatures over the eastern two-thirds of the nation with early-season heat in the South.  Power price futures for the 2026-2030 terms were 2% higher over the past week and 8% higher over the past month.  The month-to-date, day-ahead settlement price in COMED is currently averaging $32.08/MWh, which is 36% higher than April’s final settlement price average, while in AdHub they are averaging $34.76/MWh or are -24% lower than last month.   In Michigan, the month-to-date index price thus far is averaging $36.56/MWh or is -1% lower than April’s average, while in Ameren the index price is currently averaging $34.05/MWh or is 16% higher, month-over-month.
  • PJM Speeding Progress on Interconnection Queue - On 5/2 PJM announced the projects selected for the Reliability Resource Initiative (RRI), a one-time insertion of qualifying projects into a 14-month earlier phase of the interconnection queue. The 51 projects selected total 9,361 MW which equates to 7,253 MW of UCAP.   PJM also announced on 4/18 the completion of the interconnection process for Fast Lane projects. within Transition Cycle 1. Fast Lane projects were eligible for accelerated processing under PJM’s legacy serial study process if their estimated Network Upgrade allocation was less than $5 million. Approximately 25.2 GW of projects were identified as Fast Lane and PJM completed the interconnection studies in December 2024. Roughly 19 GW of Fast Lane projects have signed GIAs and are now eligible to proceed to construction. Closure of the Fast Lane was a prerequisite to officially initiate Phase 3 of the cycle study for Transition Cycle 1, which kicked off on 4/21.

Northeast Energy Summary

  • On May 7 the ISO New England (ISONE) posted final 2024 peak load date to be used in allocating capacity costs under the Forward Capacity Market. There were no changes from the preliminary values posted on February 20. The final 2024 system peak load for FCM purposes is 24,460.983 MW reached at hour ending 18:00 on Tuesday July 16, 2024.  ISO-NE will use the 2024 peak load to allocate capacity charges for the June 1, 2025-May 31, 2026 capacity commitment period (FCA16). ISONE typically posts the final peak load data for FCM purposes in February ahead of the June start of the capacity commitment period; however, this year’s posting was delayed as a result of the need to resolve various requested billing adjustments (RBAs) for potential meter data errors (Meter Reader Data Error Requested Billing Adjustments or MDE RBAs).
  • A trough over the West is bringing a ridge over the Eastern half of the nation with above and much above temperaturess expected this week. A cold front will back things down next week, bringing the East closer to normal in the 11-15 day outlook.  Forward power prices in New York moved higher last week, with Bal ’25 and Cal ’26 strips moving up ~5-6% across all power zones before retreating nearly ~2% on Monday.  

ERCOT Energy Summary

CAISO, Desert Southwest and Pacific Northwest Energy Summary

  • The heat in California and the Desert Southwest has come and gone after the weekend verified in the mid-90s throughout the LA Basin and low- to mid-100s in Phoenix. After this five-day spring heat wave, a cooling trough will begin to dig into the West bringing a cooler than normal pattern for much of the region. These cooler than normal temperatures are forecast to last into the weekend and likely into early next week across the interior West and Pacific Northwest while the models suggest there be a rewarming across California and the DSW. Low 100s are forecast to return to Phoenix towards the balance of next week while 90o temperatures look likely to return across inland California.
  • A return to seasonal spring weather has the gas and power grids back in a state of plenty as load numbers have dropped and renewable output is responsible for lifting the overall generation level in the pool. Gas transportation maintenance on Gas Transmission Northwest (GTN) continues to be a limitation in the west with flows past Kingsgate still being reduced by the work in Alberta (NGTL – AB/BC restriction) coming in around 2.2 Bcf/d over the weekend. Last week this reduction to inflows manifested as need to draw molecules from storage, we’ll see this come back this week as upward pressure on the cash market to put that volume back into storage. PG&E storage is in pretty good shape showing volumes inline with last year at 146 Bcf. SoCalGas is still in catchup mode as their tank is only showing 82 Bcf, roughly 18 Bcf behind last year at this time. While the maintenance at Aliso Cyn is slated to end this Friday, SoCalGas has significant upcoming pipeline capacity derates beginning on June 1st. At the CAISO, it should be another week of day ahead index settlements in the $20 - $30s for peak hours while the peak solar hours in SP15 will reward the buyer with a payment to take them off the hands of the generators. The off-peak settles will continue to carry a sizable premium as solar generation is past quitting time and batteries are only good for the first few hours after sunset. CAISO peak load is off between 5.2 and 6.0 GW compared to last Friday.
  • The neck of the duck is growing longer on the daily load charts as CAISO’s 3 Hour-Ramp averaged more than 19,000 MWs in April. This refers to the need for CAISO dispatchers to find replacement megawatts via ramping up thermal gens, dispatching storage resources or drawing electrons in over the interties to replace the solar output that disappears and to meet the evening load increase. For the month of April, the 3-hour ramp rate averaged more than 19,000 MW, nearly 2,000 MW more per day than last April. The 3-hour ramp record of 23,400 MW was set in March. These ramp volumes are impressive given that they all occurred at a time of the year when peak demands have yet to reach 30,000 MW.

Stay up-to-date on the latest energy news and information:

Coming soon from Constellation Customer Insights: Help us provide you with greater service by completing our online study later this month. For a limited time, eligible customers can choose to accept an incentive for taking the time to provide feedback.

  • Energy Market Intel Webinar - Register for our next market update webinar on Wednesday, May 21 at 2 p.m. ET when the CMG team will provide insights on market factors currently affecting energy prices, such as weather, gas storage and production, and domestic and global economic conditions.
  • Fortunato & Friends Webcast - Register for our next Fortunato & Friends webinar on Tuesday, May 13 at 2 p.m. ET featuring Constellation's Chief Economist, Ed Fortunato, and special guest, Nicole Perlroth, Venture Parter, Ballistic Ventures and former lead cybersecurity reporter at The New York Times.
  • Energy Terms to Know - Learn important power, gas and weather terms.
  • Sustainability Assessment - We invite you to complete a brief assessment that helps us learn where your company is in building and/or implementing a sustainability plan. Through these insights, Constellation can customize solutions to meet your needs.
  • Subscription Center - Sign up to receive updates on the latest market trends.

Questions? Please reach out to our Commodities Management Group at CMG@constellation.com.