Crude Climbs as Broader Market Weakness; June Henry Hub Nears $3/MMBtu

Crude prices climb even as broader markets weaken

• The WTI prompt-month contract rose $3.33 to $104.50/Bbl on Friday morning (7:30 AM CT)
• Crude futures were unaffected by headlines suggesting some tankers were beginning to move through the Strait of Hormuz
• • Market participants said the activity appeared limited to a small number of vessels rather than a meaningful normalization in flows, with shipping risks still elevated and diplomatic negotiations showing little concrete progress
• US 10-year Treasury yields climbed above 4.5%, a move many analysts view as increasingly tied to inflation concerns rather than energy risk alone
• • Some analysts noted that similar spikes in yields have historically coincided with verbal efforts by US officials to calm oil markets, raising the possibility of more constructive rhetoric on diplomacy following the conclusion of the Donald Trump–Xi Jinping summit
• “The path of least resistance very near term for prices remains more to the bullish side as we continue to see crude oil and fuel inventories contract," said Dennis Kissler, senior vice president for trading at BOK Financial. “Since the current agreements are far apart, escalation of tensions are more likely than not.”

June Henry Hub approaches $3/MMBtu

• The prompt NYMEX contract is trading higher this morning, approaching the $3/MMbtu level for the first time since early April
• • Gains are concentrated in the front of the curve, while most of the forward curve is flat to slightly lower
  • The June contract is on track for a weekly gain of nearly 20c
• Lower-48 population-weighted temperatures are forecast to be elevated to the ten-year average for the next several days, before returning to the ten-year average for the remainder of the next two-weeks
• • Heating demand has largely ended for the Lower-48
• LNG feedgas demand remains depressed due to maintenance at some Gulf Coast export facilities
• Yesterday, the EIA reported an 85 Bcf injection into storage, which was slightly smaller than the median expectation of 87 Bcf, and expanded the storage surplus by 1 Bcf to +140 Bcf to the five-year average

Increasing electricity demand drives PJM prices higher (Bloomberg)

• According to a report by Monitoring Analytics, PJMs independent market monitor, wholesale prices averaged $136.53/MWh in the first three months of 2026, compared to $77.78/MWh for the same period in 2025
• The report attributed the higher prices to increased demand from data centers, although the impact of winter storm Fern also lifted prices
• Higher power prices should support the economics of gas-fired generators, as the market attempts to price-in the need for more power supply
• The data center buildout is expected to accelerate over the next few years