From Natural Gas Intelligence earlier this morning:

March Continues Slide as Colder Weather Struggles to Return

Previous posts/discussion here on MarketForum on Natural Gas from last week:

https://www.marketforum.com/forum/topic/22818/

Wow! Look how fast the mild weather in December and early January caused us to close the storage gap below. 

Note: The shaded area indicates the range between the historical minimum and maximum values for the weekly series from 2014 through 2018. The dashed vertical lines indicate current and year-ago weekly periods.

EIA report from Thursday January 31, 2019

                                                                                                                                                                    -173 bcf..... bearish                                                

Summary

Working gas in storage was 2,197 Bcf as of Friday, January 25, 2019, according to EIA estimates. This represents  a net decrease of 173 Bcf from the previous week. Stocks were 14 Bcf less than last year at this time and 328 Bcf below the five-year average of 2,525 Bcf. At 2,197 Bcf, total working gas is  within the five-year historical range.

These were the temperatures, for that last report EIA report:

These were the 7 day temperatures that will go into the report that comes out this Thursday at 9:30am Central

Extreme(record) cold in the Midwest/Great Lakes but just moderately cold in the Southeast.

Any guesses on the EIA number?  This will obviously cause a deficit vs last year but the market is trading the weather forecast for the next 2 weeks.

They should rename the NG market "Algorithms r us".

 Volumes have been well under average for a couple of weeks and the bulk of this is obviously machine driven. Do any humans trade it anymore?

  Perhaps a human should buy---really beaten down

Thanks Larry,

Beaten down is an understatement tjc!

These are easily life of contracts lows here for March Natural Gas.

Closing comments from Natural Gas Intelligence:

Natural Gas Futures Slide Again with Winter Nearly Done; Spot Gas Mostly Lower

     5:42 PM    

Natural gas futures prices fell deeper into the red Monday, extending losses for a fourth consecutive day as weather models can’t seem to agree on the return of significantly colder weather. The Nymex March gas futures contract settled 7.4 cents lower at $2.66. April dropped 5.7 cents to $2.642, and the rest of the futures strip fell no more than about 5 cents

From the EIA last week:

Natural Gas Monthly

Data for November 2018  |  Release Date:   January 31, 2019

https://www.eia.gov/naturalgas/monthly/

November 2018

• In November 2018, for the 19th consecutive month, dry natural gas production increased year to year for the month. The preliminary level for dry natural gas production in November 2018 was 2,646 billion cubic feet (Bcf), or 88.2 Bcf/d. This level was 9.2 Bcf/d (11.6%) higher than the November 2017 level of 79.0 Bcf/d. The average daily rate of dry natural gas production for November was the highest for any month since EIA began tracking monthly dry natural gas production in 1973.
• The estimated natural gas consumption level in November 2018 was 2,678 Bcf, or 89.3 Bcf/d. This level was 13.9% (10.9 Bcf/d) higher than the 2,351 Bcf consumed in November 2017. Natural gas consumption for November was the highest level for the month since 2001, when EIA began using the current definitions for consuming sectors.

metmike: Cold November temperatures caused an unusually high amount of residential heating demand......which temporatly prevented the record high production from increasing the supplies/closing the 6-700 bcf gap in storage with the previous year. A negative temperature anomaly as much as 7 Deg F. in the Midwest(incredible to average that for an entire 30 days!), with very chilly weather east of the Rockies on the map below.

Then we had the opposite kind of weather in December.........record warm month for the Midwest and mild across the entire country. Look at the huge positive temperature anomalies below! This caused residential heating demand to be low, with tiny drawdowns vs average for December. 

We gained on the previous years storage by leaps and bounds........and were caught up in early/mid January.

From Natural Gas Intelligence:

                  March Natural Gas Finds Support, Nudges Higher Ahead of Open

     8:51 AM    

Despite little change in the latest weather models, March natural gas prices were set to open marginally higher Tuesday after four straight days of losses as traders sought to take profits ahead of a brief cold snap expected this weekend. The Nymex March gas futures contract was trading at around $2.69, up 2.9 cents, at around 8:30 a.m. ET

Closing Tuesday comments from Natural Gas Intelligence:

March Natural Gas Moves into Black (Barely) as Weather Model Battle Continues

After shedding nearly a quarter during the last four trading sessions, March natural gas prices managed to end Tuesday in the black -- but barely -- as major weather model differences continued between the milder Global Forecast System model and the colder European model. The Nymex March gas futures contract climbed two-tenths of a cent to settle at $2.662, while April rose eight-tenths of a cent to $2.65.

Opening Wednesday comments from NGI:

March Natural Gas Set to Open Slightly Higher as Weather Data Begins to Converge

From NGI after the bearish EIA storage report:

EIA’s Reported 237 Bcf Draw Delivers TKO to Natural Gas; Widow-Maker Flips Negative

The Energy Information Administration (EIA) reported a 237 Bcf withdrawal from storage inventories for the week ending Feb. 1. The reported build fell about 10 Bcf shy of market expectations for a week that featured the coldest temperatures of the winter in key demand regions.

Nymex natural gas futures prices, which were already about a nickel lower ahead of the report, fell another penny or so as the print hit the screen. By 11 a.m. ET, the March contract was trading 7.7 cents lower at $2.585, and April was trading 6 cents lower at $2.597. The flip in the March/April spread reflects no concerns about a supply crunch, and the smaller-than-expected withdrawal fueled that sentiment.

“This came in bearish to market expectations and reflects a market that did not really tighten at all last week, despite severe cold across the Midwest. Modeling indicated bearish risks with the number today, though after a very surprising bearish miss last week, we were looking for an implicit revision,” Bespoke Weather Services chief meteorologist Jacob Meisel said.

Instead, the gas market remains quite loose and will struggle to bounce without clear evidence of tightening in daily supply/demand balances and more bullish weather. March gas at under $2.60 “still seems cheap given lingering cold risks and plummeting imports this week, but this is certainly a bearish EIA number that will limit upside at the front of the gas strip moving forward,” Meisel said.

Broken down by region, the Midwest reported an 84 Bcf withdrawal, the second largest pull ever for that region. A 79 Bcf draw was reported in the South Central and a 59 Bcf draw was reported in the East. Both the Mountain and Pacific regions reported pulls of less than 10 Bcf, according to EIA.

Total working gas in storage as of Feb. 1 stood at 1,960 Bcf, 135 Bcf below last year and 415 Bcf below the five-year average.

Ahead of the EIA report, most market participants had called for a withdrawal in the 240-250 Bcf range. Last year, the EIA reported a withdrawal of 116 Bcf for the same week, and the five-year average draw stands at 150 Bcf.

Some market observers said the reported draws in the Midwest and South Central region appeared low but struggled to determine the reason for such a miss, although many wondered about the impact of liquefied natural gas (LNG) demand as exports were low for the reporting week and so far this week as well.

                                                                                                                                                                                    -237 bcf BEARISH!                                                                                                                                                                                                                                               

Summary

Working gas in storage was 1,960 Bcf as of Friday, February 1, 2019, according to EIA estimates. This represents  a net decrease of 237 Bcf from the previous week. Stocks were 135 Bcf less than last year at this time and 415 Bcf below the five-year average of 2,375 Bcf. At 1,960 Bcf, total working gas is  within the five-year historical range.

Closing comments Natural Gas Intelligence:

Bears Take Control as Natural Gas Futures Tumble 10-Plus Cents; Spot Gas Rises

     5:30 PM    

It just wasn’t meant to be for natural gas bulls hoping the upcoming cold weather systems would be enough to rally prices as the peak days of

Closing comments Friday:

Colder Late-February Outlooks Give Boost to Natural Gas Futures; Cash Sinks

     6:26 PM    

Natural gas futures prices put up modest gains Friday as weather models trended colder with a cold snap expected to hit the country around Feb. 18, and hinted at the possibility of more winter storms to follow. The Nymex March gas futures contract edged up 3.2 cents to settle at $2.583, while April rose 3.2 cents to $2.604.