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Weekly Energy Industry Summary

Commodity Fundamentals

Week of September 28, 2026

By the Numbers:
 
  • Prompt-month (October) natural gas expired at $3.00/MMbtu, down $.20 on Monday, September 28.
  • Prompt-month natural gas settled at $2.84/MMbtu, on Monday, September 21.
  • The October contract expired yesterday and November is now the prompt-month.
  • Prompt-month crude oil (WTI) settled at $92.60/bbl., on Monday, September 28.
  • Prompt-month crude oil (WTI) settled at $95.78/bbl., on Monday, September 21.

Natural Gas Fundamentals - Neutral

  • On September 24, Columbia Gas Transmission (TCO) declared Force Majeure after a leak was detected on Mountaineer Express pipeline at the Saunders Creek station in West Virginia affecting 1.8 Bcf/d of gas.
  • The announcement triggered a NYMEX rally on Thursday and prompt-month gas jumped $.27 as the market digested the magnitude and timing of the event.  
  • Last Friday afternoon, TCO said the outage was expected to last through the weekend with service restored by Monday and the Force Majeure was lifted effective Monday, September 28.
  • The October Nymex contract expired yesterday at $3/MMbtu, down $.20.
  • As of this writing, prompt-month (November) natural gas is trading at $3.04/MMbtu, down $.06.
  • A brief heat spike in the Midwest and South will give way to cooler air by the weekend.
  • Storage inventory forecasts will likely be reset lower than previously forecast as September power-generation demand was 10% above the five-year average, an increase of 4 Bcf per day through the month.
  • Production of natural gas has fallen over the past ten days.  Part of this decline is captured by the TCO unplanned outage, however, close attention should be paid to the supply side this week.

Crude Oil - Bullish

  • Point of Clarification: The "Bullish" moniker above will remain in place until further notice as the situation in the Persian Gulf remains highly unstable.
  • Prompt-month crude (WTI) settled at $92.60/bbl., up $0.19.
  • Saudi Arabia restarted crude oil loadings at the Yanbu port on the Red Sea after the East-West pipeline resumed service, Reuters reported.  The pipeline, that represents an important bypass of the Strait of Hormuz, had been shut down for two weeks after Iranian drone attacks damaged pumping stations on September 10.  Crude oil volumes are averaging 2 million barrels per day since last week with Reuters reporting that it may take several weeks to get the pipeline back to full service.
  • The physical oil market remains tight and global inventories of crude oil have been drawn downward.
  • U.S. and European diesel prices remain highly elevated while the possibility of a U.S. diesel-export restriction is adding another source of volatility.  Russia is also considering extending its diesel-export restrictions.

Economy - Neutral

  • The latest jobs report will be issued on Friday with current expectations cited at 95,000 new jobs and an unemployment rate of 4.1%.
  • Consumer confidence remains a weak spot with August's survey hitting a seven-month low.  The September report is due later this week.
  • Q3 GDP is attracting attention with recent estimates placing annualized growth near 5%.  
  • The August PCE inflation report is due on Wednesday with expectations at 0.5% monthly headline inflation and 0.3% core, both would be higher than July's readings.
  • The ten year Treasury bond reached 5.23% Monday, its highest level since 2007.

Weather - Neutral

  • A brief heat spike will present in the Midwest, South, and Southeast, giving way to cool fall-like air by the weekend. Next week, the Eastern half of the nation will be very "seasonal" with the exception of the West which will be hotter-than-normal.

 

 

Weekly Natural Gas Report

  • Inventories of natural gas in underground storage for the week ending September 18 are 3,351 Bcf; an injection of 53 Bcf was reported for the week ending September 18. Stocks were 146 Bcf lower than this time last year and 95 Bcf above the five-year-average.
Values reflect week ending Sept. 25, 2026
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Prices reflect week ending Sept. 25, 2026

Weekly Power Report:

Mid-Atlantic Electric Summary

  • The Mid-Atlantic Region’s forward power prices continue their trend upward, this past week, as the market is currently weighing the improving supply picture from the return of the Mountaineer Xpress Pipeline in West Virginia with the higher demand for LNG feedgas flowing to the plants.  This week will bring a brief heat spike from portions of the Midwest into the South and East ahead of a cold front that will bring flooding to the nation’s midsection.  This will be followed by fall-like conditions next week across the eastern half of the nation with some below normal temperatures mixed into the forecasts. This will bring some overnight heating demand across the North and East, while supporting open-window weather across the South.  The forward electricity prices for the 2027-2031 calendar strips were 2% higher over the past week and 4% higher over the past month.  Congestion risk continues to plague many of the higher demand markets in PJM due to the steady increase in demand.  The month-to-date, day-ahead settlement price for September in West Hub is $65.92/MWh which is 26% higher than August’s final settlement price average of $52.31/MWh.
  • Energy Commission of Virginia RGGI Subcommittee Meets to Discuss Ratepayer Relief and Data Center Impacts - The RGGI Subcommittee of the Energy Commission of Virginia met on 9/21 to consider allowance prices, program revenues, and the implications of Virginia’s recent reentry into the Regional Greenhouse Gas Initiative (RGGI).  Discussion highlighted continued legislative support for RGGI, with policymakers emphasizing the program’s important role in funding ratepayer assistance, energy efficiency initiatives, and flood resilience programs.  Participants also examined factors contributing to higher allowance prices, including tightening emission reduction targets, growing electricity demand from data centers, and broader market and policy developments.  A significant portion of the hearing focused on the relationship between data center growth, electricity demand, and RGGI compliance costs.  Lawmakers and stakeholders discussed whether large-load customers such as data centers should bear a greater share of RGGI-related costs and whether behind-the-meter generation serving data centers should be more directly covered under the program.  The subcommittee indicated it will continue evaluating these issues as Virginia moves toward full alignment with recent RGGI program reforms and prepares updated regulations expected in mid-to-late October.

Great Lakes Electric Summary

  • The Great Lakes Region’s power prices continued their upward trend this past week as the market is currently weighing improvement in the supply picture from the return of the Mountaineer Xpress Pipeline in West Virginia with the higher demand for LNG feedgas flowing to the plants.  This week will bring a brief heat spike from portions of the Midwest into the South and East ahead of a cold front that will bring flooding to the nation’s midsection. This will be followed by fall-like conditions next week across the eastern half of the nation with some below normal temperatures mixed into the forecasts. This will bring some overnight heating demand across the North and East, while supporting open-window weather across the South. The forward electricity prices for the 2027-2031 calendar strips were 2% higher over the past week and 6% higher over the past month.  Congestion risk continues to plague many of the higher demand markets in PJM and MISO due to the steady increase in demand.  The current, month-to-date day-ahead settlement price average for September in COMED is $47.49/MWh or is 20% higher than August settlement, while that average price in AdHub is $62.51/MWh or is 36% higher month-over-month.  In Michigan the current month-to-date price average is $57.33/MWh or is 29% higher than the prior month, while in Ameren the average price so far is $59.23/MWh, or is 44% higher than last month’s final average price.
  • Governor Pritzker Creates the Illinois Artificial Intelligence Cabinet - The Illinois Artificial Intelligence Cabinet, created by Governor Pritzker’s Executive Order (EO) 2026-27, is a statewide advisory body charged with assessing the risks and opportunities associated with rapidly advancing AI technologies.  The cabinet will bring together experts from government, academia, and other sectors to develop recommendations on AI safety, governance, risk management, cybersecurity, infrastructure protection, and public safety.  The order notes growing concerns related to artificial intelligence, including cybersecurity, critical infrastructure, privacy, and the increasing energy demands associated with AI and AI-related data centers.  The cabinet is directed to evaluate AI-related risks and provide recommendations to state government through December 2027.  While the order is not focused on data center development, its recognition of AI-driven energy demand highlights an issue that is becoming increasingly relevant to Illinois economic development and energy policy discussions.

Northeast Energy Summary

  • On September 8, Massachusetts Governor Maura Healey issued Executive Order 658, establishing binding requirements for new and expanded data centers with peak electric demand exceeding 25 MW.  The order formalizes the administration's June 2026 data center framework and is designed to ensure that large data center projects do not increase costs for ratepayers, strain energy and water resources, or proceed without meaningful local community support.  Key provisions require developers to obtain local support through community benefits agreements and secure sufficient incremental new clean energy resources to meet annual electricity consumption.  Clean energy is defined as resources that qualify for the state’s Clean Energy Standard, including solar, wind, small hydroelectric, landfill gas, geothermal, and new nuclear.  Data centers that fail to procure adequate clean energy will be subject to alternative compliance payments with collected funds directed to a new Ratepayer Protection Fund to offset electricity supply costs for Massachusetts customers.  The order also directs state agencies to ensure data centers bear the costs of needed electric infrastructure, prevents speculative projects from clogging utility interconnection queues, requires evaluation and mitigation of greenhouse gas emissions, establishes water resource protection protocols, and creates annual reporting requirements for operating facilities.  In addition, it prohibits the use of non-disclosure agreements between state agencies and data center developers to increase transparency in the permitting process.  Further, it requires all state agencies to publish municipal guidance for evaluating proposed data center projects by the end of 2026 and provide annual reports beginning in 2027 on additional policy, regulatory, and legislative actions needed to support responsible data center development while protecting ratepayers, communities, and environmental resources.
  • This week will bring a brief heat spike from portions of the Midwest into the East before the return of more fall-like conditions and occasional below normal temperatures/overnight heating demand next week in New York and the Northeast. Electricity prices moved lower in September for all New York load zones, with Zone J day-ahead prices averaging ~$45/MWh this month versus ~$52/MWh in August. September day-ahead prices averaged ~$43/MWh in zones G/F,   $41/MWh in zone C, and $38/MWh in zone A.  The ‘26-27 winter strip has fallen considerably over the last month as winter outlooks and the current El NINO pattern have the market anticipating warmer-than-normal temps for the Northeast this season.   New York City (Zone J) winter strip is off nearly 11% at ~$126/MWh; Western New York (Zone A) is off ~8% at ~$103/MWh. While prices are lower month-over-month, they remain supported year-over-year, with the prompt winter strip up roughly ~30% depending on zone.
  • The New York Public Service Commission (PSC) has opened a proceeding to implement new energy affordability measures enacted in the FY27 Budget, including development of an Energy Affordability Index for electric and gas utilities.  The index will assess whether household utility costs remain below the State’s 6% affordability target, 3% for electric service and 3% for gas service.  It will also factor in upcoming utility rate cases and annual affordability filings, which are due 2/1/27, with the first statewide affordability report expected by 7/1/27.  If a utility exceeds the affordability threshold, the PSC may appoint an independent Affordability Monitor to review utility operations, cost drivers, and potential savings opportunities.  The initiative also links affordability performance to executive and senior management compensation, reinforcing the administration’s broader focus on ratepayer protection, utility cost discipline, and scrutiny of utility spending as rate pressures continue to be a central policy issue in New York.

ERCOT Energy Summary

CAISO, Desert Southwest and Pacific Northwest Energy Summary

  • The warmer than normal pattern will continue across California this week with daytime highs mostly in the 80s to low 90s in the LA Basin away from the coast while more seasonable temperatures will be seen along the immediate coast. The state will then begin to grow warmer heading into this weekend as our first meaningful Santa Ana event of the season takes aim at SoCal. This doesn't appear to be a record setting event, but offshore winds will bring AC demand to the coast as daytime highs move towards the 80s while daytime highs will climb into the upper 90s to low 100s across the interior LA Basin and Central Valley. The pattern will grow warmer elsewhere across the West as well with 80s across much of the interior while highs will likely be milder in the 70s across the Pacific Northwest. Longer term, above to much above normals will still be common across the Western U.S. heading into the 11-15 day period as Western ridging keeps more meaningful cooling demand going across California and the Southwest while milder temperatures will be seen more across the Pacific Northwest and Western Canada.
  • Key themes for early October include:
    • Gas Storage Injections: storage operators for PG&E and SoCalGas remain focused on refilling space in the caverns opened by the heat and demands of meeting August and early September loads.
    • Displaced Midday Gas Generation: moderate regional temperatures are easing power grid demand. Renewables are positioned to dominate the midday period as seen throughout the spring and early summer, meaning curtailments and prices below the $0 MWh waterline will become frequent.
    • Wildfires and Dwindling Pacific Northwest Supplies: two critical risk factors to watch are sliding import availability from the Pacific Northwest as hydro supplies have dissipated in the late innings of the water year thereby limiting Northwest energy support as we begin the new water year on Thursday. We’re still in the early innings of the fire season and there’s plenty of time for conflagrations that can impose sudden limitations on the grid.
  • California’s long‑term target is to have about 52,000 MW of battery storage by 2045 to support its 100% clean electricity goal, and the state is already about one-third of the way towards that goal. The roughly 16,900 MW of large-scale storage projects that are on the grid today have been instrumental in allowing the CAISO to time-shift renewable production, mainly solar, that floods the midday hours and deploys it later in the day to effectively extend daylight from an electrical perspective. One challenge storage developers have faced in recent years has been a history of headlines coming from the battery facilities at Moss Landing. In September 2021 and February 2022, leaks in water-based suppression systems caused batteries to overheat and produce smoke. The developer said neither incident was a fire. In September 2022, a battery caught fire at PG&E’s separate Elkhorn battery facility nearby. The most serious incident occurred in January 2025, when a fire occurred and burned for two days closing a stretch of Highway 1 and forced more than 1,000 residents to evacuate. A flare-up occurred in the damaged building in February of that year. Two weeks ago, another fire at Moss Landing sent smoke into the air and prompted Monterey County officials to issue a shelter-in-place order for nearby residents. The facility has remained closed since the major fire in January 2025, and crews were still removing batteries from the damaged building when the latest fire occurred. The latest fire shows that the risk has persisted during cleanup. Some batteries in the damaged building remained difficult to access and could still hold a charge. Officials have not established a definitive cause of the latest fire. The playing field continues to tilt against further battery development as anyone who learns of a battery proposal near their home and begins researching will inevitably discover the Moss Landing incidents.

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