For weather that effects the natural gas market(Cooling Degree Days in the Summer help gauge residential natural gas use because natural gas is used to generate electricity for air conditioning...........and now, to generate residential heating:
From Natural Gas Intelligence:
October Natural Gas Called Slightly Higher as HDDs Build in Outlook
8:44 AM
The October natural gas futures contract was trading about 0.7 cents higher at around $2.821 shortly after 8 a.m. ET Tuesday as forecasters pointed to glimpses of fall heating demand showing up in the outlook toward the end of the month.
Storage is Very Low for this time of year!! This is why the temperature forecast matters....in the Summer/cooling season and Winter/heating season.
Storage is just below the bottom of the previous 5 year range and also almost 700 bcf below last year at this time!
Last Thursday's EIA Number: +69 billion cubic feet-neutral I thought the number would be smaller, so there must be alot of supply out there!
Working gas in underground storage, Lower 48 states Summary textCSVJSN | |||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Historical Comparisons | |||||||||||||||||||||||||
Stocks billion cubic feet (Bcf) | Year ago (09/07/17) | 5-year average (2013-17) | |||||||||||||||||||||||
Region | 09/07/18 | 08/31/18 | net change | implied flow | Bcf | % change | Bcf | % change | |||||||||||||||||
East | 679 | 659 | 20 | 20 | 805 | -15.7 | 780 | -12.9 | |||||||||||||||||
Midwest | 734 | 702 | 32 | 32 | 901 | -18.5 | 879 | -16.5 | |||||||||||||||||
Mountain | 166 | 162 | 4 | 4 | 208 | -20.2 | 195 | -14.9 | |||||||||||||||||
Pacific | 250 | 246 | 4 | 4 | 296 | -15.5 | 326 | -23.3 | |||||||||||||||||
South Central | 806 | 799 | 7 | 7 | 1,088 | -25.9 | 1,052 | -23.4 | |||||||||||||||||
Salt | 182 | 183 | -1 | -1 | 282 | -35.5 | 268 | -32.1 | |||||||||||||||||
Nonsalt | 624 | 615 | 9 | 9 | 806 | -22.6 | 784 | -20.4 | |||||||||||||||||
Total | 2,636 | 2,567 | 69 | 69 | 3,298 | -20.1 | 3,232 | -18.4 | |||||||||||||||||
Here are the temperatures from the 7 day period, ending last Friday that was used for this EIA storage report. Near record heat in some high population centers of the East(and Eastern Midwest). So the injection was a bit less than the 5 year average.
These were the temperatures last week, for the 7 day period that will be used for this Thursday EIA report:
Natural gas hit some tough resistance back in August. Even the hottest of the hot forecasts couldn't push us to $3 with very low storage.
Temperatures as we go out to late September are getting to the time of year that is not as important for cooling. The heating season is coming up and we have some chill in the forecast today. Tuesday update: Even more chill and HDD's vs Monday.
Natural gas 3 months |
Naturalgas 1 year below
Naturalgas 5 years below
Naturalgas10years below |
Previous comments:
By WxFollower - Sept. 17, 2018, 11:24 a.m.
Mike,
Regarding the +69 EIA, don’t forget that this was for Labor Day week, which typically has reduced demand per CDD vs surrounding weeks. So, it isn’t as bearish as one might think when this is taken into account.
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By metmike - Sept. 17, 2018, 2:21 p.m.
Thanks Larry,
I forgot about that.
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By Jim_M - Sept. 17, 2018, 3:22 p.m.
Bearish? Where storage is right now, anything under 100 bcf is bullish. Throw a cold month in this winter and things could get very serious.
Closing comments from Natural Gas Intelligence:
Natural Gas Futures Bulls Ride Cash Strength to Rally Market
6:02 PM
Don’t call it a comeback, but natural gas futures bulls reasserted themselves Tuesday, seizing on strong cash prices and signs of continued weather-driven demand to rally a market in need of a mild shoulder season to refill depleted stockpiles. Spot prices surged in the Mid-Atlantic as West Texas cash basis weakened; the NGI National Spot Gas Average added 3 cents to $2.75/MMBtu.
metmike: I think the chilly extended weather and HDD's did it.