Time for a new NG thread as we approach the start of the cold season, the strongest demand period for NG since it’s used by many for heating.
Thanks very much for starting the new thread, Larry.
You are exactly right about this being the bread and butter weather trading market in the heating season!
This was the previous thread:
NG 8/4/25-10/9/25
77 responses |
Started by WxFollower - Aug. 4, 2025, 12:26 a.m.
Re: Re: Re: Re: Re: NG 8/4/25+
By metmike - Oct. 9, 2025, 1:33 a.m.
Near record warmth in the NorthCentral US last week where HDDs are normally higher than CDDs so the warmth there was bearish.
Plenty of warmth to go around in other places except a bit cool West/Southwest compared to average.
https://www.cpc.ncep.noaa.gov/products/tanal/temp_analyses.php
+++++++++++++
Actual EIA number was close to expected. Storage levels will likely peak in November before the first major cold snap.
Stocks are slightly above last year. However, last Winter was very cold compared to average. Look at the graph below and not THE BLUE LINE. This is the storage level of the last EIA report.
Storage went from near record highs a year, to well below the 5 year average and near the bottom of the 5 year range!!!!
This shows, as Larry stated why temperatures in the HDD season are so critical to storage and prices!! So the current surplus, even higher than last year's(at the moment) is not enough to prevent storage from getting low by early in 2026!!!
https://ir.eia.gov/ngs/ngs.html
for week ending October 3, 2025 | Released: October 9, 2025 at 10:30 a.m. | Next Release: October 16, 2025
| Working gas in underground storage, Lower 48 states Summary text CSV JSN | |||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Historical Comparisons | |||||||||||||||||||||||||
| Stocks billion cubic feet (Bcf) | Year ago (10/03/24) | 5-year average (2020-24) | |||||||||||||||||||||||
| Region | 10/03/25 | 09/26/25 | net change | implied flow | Bcf | % change | Bcf | % change | |||||||||||||||||
| East | 860 | 832 | 28 | 28 | 869 | -1.0 | 842 | 2.1 | |||||||||||||||||
| Midwest | 1,001 | 972 | 29 | 29 | 1,037 | -3.5 | 1,004 | -0.3 | |||||||||||||||||
| Mountain | 275 | 269 | 6 | 6 | 286 | -3.8 | 232 | 18.5 | |||||||||||||||||
| Pacific | 304 | 302 | 2 | 2 | 293 | 3.8 | 277 | 9.7 | |||||||||||||||||
| South Central | 1,201 | 1,186 | 15 | 15 | 1,133 | 6.0 | 1,129 | 6.4 | |||||||||||||||||
| Salt | 295 | 292 | 3 | 3 | 272 | 8.5 | 280 | 5.4 | |||||||||||||||||
| Nonsalt | 906 | 894 | 12 | 12 | 861 | 5.2 | 849 | 6.7 | |||||||||||||||||
| Total | 3,641 | 3,561 | 80 | 80 | 3,618 | 0.6 | 3,484 | 4.5 | |||||||||||||||||
| Totals may not equal sum of components because of independent rounding. | |||||||||||||||||||||||||
Working gas in storage was 3,641 Bcf as of Friday, October 3, 2025, according to EIA estimates. This represents a net increase of 80 Bcf from the previous week. Stocks were 23 Bcf higher than last year at this time and 157 Bcf above the five-year average of 3,484 Bcf. At 3,641 Bcf, total working gas is within the five-year historical range.
For information on sampling error in this report, see Estimated Measures of Sampling Variability table below.
This is a time of year when ng futures move higher towards a seasonal peak ahead of Winter as the market dials in cold weather risk premium and storage fills up with extra buying. Each year is different but this average over the past 20 years gives us clear tendencies at certain times of year.
Some seasonal rules that I use:
1. Being long in April/May almost always makes money, regardless of the weather.
2. Being short in Dec/Jan during widespread unusual warmth almost always makes BIG money.
3. Extreme cold during the first half of the heating season usually has a much higher impact on speculators buying than towards the end, unless storage is very low. During the back half of the heating season, the market knows that time is running out to draw down storage.
4. Summer heat waves don't have the same RELIABLE impact on prices as extreme cold in Winter but are tradable.
5. The market, under some conditions (early Winter-pattern change to brutal cold) can start trading that weather 2 weeks before it starts.
Got any more, Larry?
https://charts.equityclock.com/natural-gas-futures-ng-seasonal-chart
Natural gas price charts.
https://tradingeconomics.com/commodity/natural-gas
1. 10 years: Classical symmetrical wedge with lower highs and higher lows.
2022-highs from very low storage, followed by massive injections and near record high storage-low prices in 2023/24, followed by near record draw downs from the cold Winter of 24/25-spike to a lower high early 2025. Downtrend line since then, recently touched as the apex of the triangle is approaching.
2. 1 year:
a. 2 strong uptrend channels from last Winters cold. Major market top in March 2025.
b. Late Spring/early Summer uptrend channel from Spring positive seasonal along with widespread intense heat forecasts for the Summer of 2025.
c. Downtrend channel that accelerated in late August from huge pattern change to widespread near record cool temps(and low electricity use for AC use, generated by burning natural gas)
d. Bottom ahead of positive Fall seasonal and late season heat returning with elevated CDDs.
e. Prices at the very end have plunged again as late season heat has turned from bullish to bearish. Rapidly increasing average HDDs pass up rapidly dropping CDDs on October 4th but every year is different. The VERY warm forecasts this week are now BEARISH weather.
3. 1 month: Early seasonal high???? This usually doesn't happen until well into November but varies from year to year. My guess is that a pattern change to widespread MUCH colder temps in the high population centers that has staying power will make new highs.
The straight up line in the center of the graph was the price adjustment from the lower priced October contract rollover to the higher priced November contract that is the current front month.
