Natural Gas Sunday/Monday
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Started by metmike - Nov. 25, 2018, 8:21 p.m.

Natural gas opened with a massive gap lower.............so what's new. It was not just a daily gap but a weekly gap lower.

Last weeks low was 4.222. 

We hit a low of 4.015 but have recovered a bit to fill part of the gap, back up to 4.100 so far.

December natural gas, the front month goes off the board on Wednesday.


With that being the case, time to be trading the January contract now that already has twice the volume tonight vs the December.

The contract high for Jan ng on 11-14 was 4.964.

Last weeks low was 4.252 for ngF19.

4.067 was the low from earlier this evening and the high so far tonight looks like 4.152.

So we have a big fat lower gap open between 4.252, last weeks low and 4.152, tonights/this weeks high.

Is this a break away gap lower?

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By metmike - Nov. 25, 2018, 8:40 p.m.
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Many of the GFS operational model recent runs have turned up the frigid weather in week 2 with it being the coldest model by far. Some of the GFS ensembles followed that trend for awhile, earlier in the weekend but the most recent 18z run of the GFS ensembles is very mild, with an 850 temp of 0 C at Chicago at 360 hours vs -10 deg C yesterday for the same map. That's a major warm up on the GFS ensembles.

The Canadian ensembles have been looking very mild, zonal at times(but still some very cold ones)

The AO and NAO are moving up towards zero which is less of a cold threat but with huge spread.

The European ensembles, after being mild in week 1, turn colder in week 2 but not extremely cold. 


The CFS climate model is VERY mild after week 2 and continues that from mid December all the way into early Janurary. Larry will tell you that models don't have a great deal of skill at that time frame. 


Forecast Hour:  360 GFS ensembles 18z..............cold air is up in Canada. -10 deg C isotherm is more than 500 miles farther north than it was on yesterdays 360 hour map, when it was at Chicago.
Image URL: http://mag.ncep.noaa.gov/data/gefs-mean-sprd/18/gefs-mean-sprd_namer_360_850_temp.gif

   

gefs-mean-sprd_namer_360_850_temp.gif

By metmike - Nov. 25, 2018, 8:46 p.m.
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The storage deficit with a year ago increased. It's now -620 bcf after last week's record earliest triple digit withdrawal at -134 bcf. 

But most of this bullish news was dialed in last week and previously. We spiked higher briefly after the number came out and could never get back to that price again.


Working Gas in Underground Storage Compared with Five-Year Range

By metmike - Nov. 25, 2018, 8:47 p.m.
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         -134 bcf                                                                                                                                                

Working gas in underground storage, Lower 48 states Summary textCSVJSN
  Historical Comparisons
Stocks
billion cubic feet (Bcf)
 Year ago
(11/16/17)
5-year average
(2013-17) 
Region11/16/1811/09/18net changeimplied flow  Bcf% change Bcf% change
East803  835  -32  -32   894  -10.2  909  -11.7  
Midwest959  991  -32  -32   1,093  -12.3  1,090  -12.0  
Mountain174  181  -7  -7   220  -20.9  218  -20.2  
Pacific258  266  -8  -8   314  -17.8  350  -26.3  
South Central919  974  -55  -55   1,211  -24.1  1,256  -26.8  
   Salt251  272  -21  -21   340  -26.2  353  -28.9  
   Nonsalt668  702  -34  -34   871  -23.3  903  -26.0  
Total3,113  3,247  -134  -134   3,733  -16.6  3,823  -18.6  

                                    


            

                

By metmike - Nov. 25, 2018, 8:48 p.m.
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These were the temperatures for that report:

http://www.cpc.ncep.noaa.gov/products/tanal/7day/mean/20181116.7day.mean.F.gif

By metmike - Nov. 25, 2018, 8:51 p.m.
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Here are the temperatures for the 7 day period(ending this last Friday) for the next report, this Thursday at 9:30am.  

Another unusually big drawdown for this early in the season but smaller than the previous week. 

Colder in the Northeast but milder everywhere else.

Any guesses?


Anotherhttp://www.cpc.ncep.noaa.gov/products/tanal/7day/mean/20181123.7day.mean.F.gif

By metmike - Nov. 25, 2018, 8:55 p.m.
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Is the top in? Going to take some extreme cold to get back up to the highs of 4.949 on December 14th.

Natural gas 3 months
         
By metmike - Nov. 25, 2018, 8:58 p.m.
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Repeating the frigid Winter of 5 years ago, gets storage to precariously low levels and the price spikes to the highest in over a decade. Based on the EIA projections and stats below, if we used up the same amount of gas this Winter, as we did 5 years ago, supplies would end up below 800 bcf(maybe not lower than that because extremely high prices would discourage some demand)!

Repeating the mild Winters of 2 and 3 years ago and storage catches all the way up with last year and prices get buried below $3 again by late Winter(with the huge amount of demand early in the heating season, that means the catching up might take longer now-early Spring with a mild Winter).



Right now EIA projects winter heating demand at about 6.6 TCF, and end of season inventories at 1.37 TCF on March 31st. Heating demand over the last 28 winters ranged from 5.7 TCF to 7.3 TCF, averaging 6.4. Here's the history from EIA:

By metmike - Nov. 26, 2018, 10:16 a.m.
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Monday morning from NGI:


Long-Range Pattern Uncertain as December Natural Gas Called Lower

     8:59 AM    

December natural gas futures were trading at $4.074/MMBtu shortly before 9 a.m. ET Monday, down 23.4 cents from Friday’s settle as forecasters were pointing to an uncertain outlook for temperatures toward the second half of next month.

By metmike - Nov. 27, 2018, 12:14 a.m.
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Natural Gas Intelligence closing comments:


Mid-December Looking Warmer as Natural Gas Futures Bulls Give Ground; Negative Cash Trades in West Texas

     6:18 PM    

Natural gas futures slid over the holiday weekend and Monday, with indications of a milder pattern developing for mid-December potentially discouraging the bulls. In the spot market, prices generally followed the futures lower, while constrained West Texas points saw prices veer into negative territory for the first time on record in the United States; the NGI Spot Gas National Avg. dropped 60.0 cents to $4.295/MMBtu.