Wednesday, August 14, 2019 at 5:18PM
In each of the last two mornings, we have seen natural gas prices make a move that seemed rather exaggerated, yesterday to the downside, and today to the upside. Neither move held, and we continue to see prices chop around in a tight range, with today’s close just a few ticks under yesterday’s.
Rather unsurprisingly, the overall backdrop remains the same as it has been for nearly two weeks now, as we are stuck with above normal demand thanks to the hotter weather pattern, but faced with new highs in production, and lower LNG intake.
On the weather side, one cannot deny the strength of the heat, keeping forecast Gas-Weighted Degree Days (GWDDs) well above normal.
There are regional shifts as far as where the heat is focused, but as our forecast maps show, coverage of above normal temperature anomalies is plentiful in key areas.
Weighing against the higher demand, we have seen new all-time highs in natural gas production in recent days.
LNG intake remains depressed as well, for now.
The end result has been an environment that has produced volatility as these bullish and bearish forces battle, but in the end, prices have struggled to really go anywhere for nearly two weeks now. Of course, a range only holds until it doesn’t, requiring constant monitoring of data on both the supply and demand side in order to anticipate the next move. Our blended weather and fundamentals research is geared toward just that. Sign up for a 10-day free trial here and you can take a close look at the products we have to offer in order to stay ahead of the natural gas market.
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