Webinar Analysts: 2024 Election Impacts, Winter Weather Outlook and Natural Gas Fundamentals
During the November Constellation monthly Energy Market Intelligence Webinar, Constellation’s Commodities Management Group (CMG) provided comprehensive coverage of various significant factors affecting the energy landscape. The webinar featured discussions on current drivers of energy market prices including a forecast of winter weather, the impact of the 2024 election on energy markets, natural gas production and storage fundamentals and a look at the 2024 NERC Winter Assessment.
Weather Report
The team kicked off the webinar covering the current weather patterns and forecasts. The latest data suggests a neutral or weak La Niña leading to a more neutral weather pattern, with above-normal temperatures in the eastern U.S., while the Northwest and Rockies may experience stormy and cold weather. The team also discussed the recent hydro outlook in California and an update on the drought conditions across the U.S.
All Things Economic
Moving to the economy, Chief Economist, Ed Fortunato, provided insights into the current and future state of the economy post-election. In the short-term, the stock market and cryptocurrency markets have responded positively to the election and economic indicators such as mortgage rates, yield curve and GDP point towards a strengthening economy. In the longer term, the market seems to be anticipating corporate tax cuts, potential rollbacks of regulations and the impact of tariffs on imported goods.
2024 Election Impacts
The biggest news in the United States in November was the 2024 Presidential election and the perceived impacts that a second Trump administration would have on the energy markets. Constellation’s Vice President of Federal Government Affairs, David Gilbert, joined the webinar to provide his insights into the next four years. The discussion highlighted the future of regulations that have hindered oil and gas drilling. In the renewable space, the clean energy support of the Inflation Reduction Act (IRA) may be in jeopardy as well as U.S. involvement with the Paris Climate Agreement. The team also covered budget reconciliation, which is a legislative process that allows for expedited consideration of certain tax, spending and debt limit legislation that the administration will try to pass.
Natural Gas Fundamentals
Mild weather to start the traditional “heating season” has allowed for injections to continue, bringing stocks just below 4.0 Tcf, a level not seen since 2016. On the production side, several key factors such as heating demand and policies of the incoming administration are influencing producers’ activity, which has settled around 100-101 Bcf/d in recent months.
NERC Winter Assessment
The team then highlighted the NERC Winter Reliability Assessment, the steady increase in natural gas demand from generation and its implications for grid reliability. The assessment emphasized the importance of ensuring sufficient natural gas supplies to meet the increased demand during the winter months. It also addressed the potential risks and challenges associated with maintaining grid reliability in the face of variable weather patterns and increased energy consumption. Overall, the assessment underscored the need for careful planning and coordination to ensure a reliable energy supply during the winter season.
Market Trends and Temperature
The team concluded the webinar by looking at forward power charts, the “Market Temperature,” and other factors affecting the energy market.
We invite you to join us for our next Energy Market Intel Webinar on Wednesday, December 18 at 2 pm ET. Constellation energy experts will offer detailed and timely updates on factors affecting energy landscape such as weather, natural gas storage and production, and domestic and global economic conditions. Register by visiting www.constellation.com/marketintelwebinar.
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