President Biden’s Energy Policies May Have Harmed Economy
According to the Schork Group, President Biden’s energy policies had a positive effect on oil prices and negative impact on the economy. Biden’s energy actions, including the cancelation of the Keystone XL oil pipeline project and temporarily postponing issuing out of oil and gas permits on federal land and water, were set in place in order to battle climate change.
Mild spring temperatures in addition to recent production gains have helped decrease the storage deficit from -178 Bcf in late February to only -24 Bcf today. Meanwhile, the May 2021 natural gas contract,
which was trading about three cents lower than yesterday’s settle early this morning, climbed higher and is currently trading flat at $2.52/MMBtu and the May 2021 crude oil contract is down $0.37 at $59.40.
Natural gas pricing plays a key role in electricity power pricing due to the increasing reliance on natural gas fired generat ors as nuclear, coal, and oil generation is retired and mothballed. As the marginal unit
of generation, gas prices are directly correlated to power pricing (more so in some regions such as NYC vs. others such as parts of PJM). We keep an eye on natural gas market fundamentals in order to provide insights into forward power pricing for our clients. Gas production has grown and surpassed any speculation that production would not be able to keep up with demand due to LNG and Mexican exports.