SoCal Gas summer 2021 forward curve hits 3-year high amid mounting supply concerns

摘要

A tightening supply outlook for Southern California's gas market is fueling a rally in forward strip prices there as shifting regional flow dynamics and upcoming system maintenance make for a bullish scenario. Since the start of January, the SoCal Gas city-gate April-to- October strip has gained 60 cents, or over 17%, most recently settling at an average $4.04/MMBtu, S&P Global Platts' M2MS forwards data shows. The steady rise in Southern California's summer strip prices comes in response to lackluster production from the Permian Basin and emerging competition for its gas supply-historically of critical importance for Southern California. More recently, news from SoCal Gas about an upcoming summer-long maintenance in the utility's service area has added fuel to the forward-market rally as concerns over reduced transmission capacity mount.