Natural Gas Thursday
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Started by metmike - July 12, 2018, 10:30 a.m.

For the latest weather that effects the  Natural Gas market go here:

https://www.marketforum.com/forum/topic/7443/

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By metmike - July 12, 2018, 10:31 a.m.
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Market Awaiting EIA Storage Report as August Natural Gas Called Lower

     8:48 AM    

August natural gas futures were set to open Thursday about 1.6 cents lower at around $2.813/MMBtu, with the market looking ahead to a potentially leaner than average Energy Information Administration (EIA) storage report that could help gauge the impact of recent heat. 

By metmike - July 12, 2018, 10:32 a.m.
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From Natural Gas Intelligence, following the storage report:

EIA Storage Build Lighter Than Surveys, But Natural Gas Futures Market Not Impressed

Weekly Natural Gas Storage Report  +51

 for week ending July 6, 2018   |  Released: July 12, 2018 at 10:30 a.m.   |  Next Release: July 19, 2018 

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

Working gas in underground storage, Lower 48 states Summary text CSV JSN
  Historical Comparisons
Stocks
billion cubic feet (Bcf)
 Year ago
(07/06/17)
5-year average
(2013-17) 
Region07/06/1806/29/18net changeimplied flow  Bcf% change Bcf% change
East480  460  20  20   585  -17.9  593  -19.1  
Midwest477  455  22  22   716  -33.4  642  -25.7  
Mountain143  139  4  4   192  -25.5  168  -14.9  
Pacific260  257  3  3   291  -10.7  305  -14.8  
South Central843  841  2  2   1,144  -26.3  1,014  -16.9  
   Salt238  245  -7  -7   328  -27.4  291  -18.2  
   Nonsalt605  596  9  9   816  -25.9  723  -16.3  
Total2,203  2,152  51  51   2,928  -24.8  2,722  -19.1  

By metmike - July 12, 2018, 10:35 a.m.
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These temperatures below cover the period for this last EIA report  It was a hot week!http://www.cpc.ncep.noaa.gov/products/tanal/7day/mean/20180706.7day.mean.F.gif


Below, they are broken down into Highs/Lows for the same 7 day period:http://www.cpc.ncep.noaa.gov/products/tanal/7day/max_min/20180706.7day.max_min.F.gif

By metmike - July 12, 2018, 10:38 a.m.
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By metmike - July 10, 2018, 2:30 p.m.            

            

Natural gas is testing the uptrend line from the Dec 2017 lows, just above 2.6,  connecting to the higher lows in Feb. just below 2.7, then the higher lows in May at 2.727.

Natural gas 3 months
         


Naturalgas 1 year below

Naturalgas 5 years below

                   

Naturalgas10years below                
                   
By metmike - July 12, 2018, 10:39 a.m.
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July 10, 2018

Short-Term Energy Outlook From US Energy Information Administration:


https://www.eia.gov/outlooks/steo/

  • U.S. dry natural gas production averaged 73.6 billion cubic feet per day (Bcf/d) in 2017. EIA forecasts dry natural gas production will average 81.3 Bcf/d in 2018, which would establish a new record. EIA expects natural gas production will rise by an additional 3.1 Bcf/d in 2019 to 84.5 Bcf/d.
  • The Henry Hub natural gas spot price averaged $2.97/million British thermal units (MMBtu) in June. EIA expects Henry Hub natural gas spot prices to average $2.99/MMBtu in 2018 and $3.04/MMBtu in 2019. NYMEX futures and options contract values for October 2018 delivery that traded during the five-day period ending July 5, 2018, suggest a range of $2.37/MMBtu to $3.59/MMBtu encompasses the market expectation for October Henry Hub natural gas prices at the 95% confidence level.
  • EIA expects the share of U.S. total utility-scale electricity generation from natural gas-fired power plants to rise from 32% in 2017 to 34% in 2018 and to 35% in 2019. In this outlook, coal's forecast share of electricity generation falls from 30% in 2017 to 28% in 2018 and to 27% in 2019. The nuclear share of generation was 20% in 2017 and is forecast to be slightly less than that share in 2018 and in 2019. Nonhydropower renewables provided slightly less than 10% of electricity generation in 2017 and are expected to provide more than 10% in 2018 and nearly 11% in 2019. The generation share of hydropower was 7% in 2017 and is forecast to be slightly less than that share in 2018 and in 2019.
  • After declining by 0.9% in 2017, EIA forecasts that energy-related carbon dioxide (CO2) emissions will increase by 1.8% in 2018 and decrease by 0.5% in 2019. Energy-related CO2 emissions are sensitive to changes in weather, economic growth, energy prices, and fuel mix.

                                    


            

                


By metmike - July 12, 2018, 10:40 a.m.
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  • U.S. residential electricity price
  • West Texas Intermediate (WTI) crude oil price
  • World liquid fuels production and consumption balance
  • U.S. natural gas prices
By metmike - July 12, 2018, 10:41 a.m.
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 By WxFollower - July 10, 2018, 8:06 p.m.            

            

Production Surge Keeping Natural Gas Futures Bears in Control; Spot Prices Pull Back

     5:19 PM    

 From the very long article found at the above link, this little bit is the key to today's price drop:

"Looking at the weather, overnight changes heading into Tuesday’s session showed cooler trends late next week and next weekend, and those trends continued in the midday data, dropping a few additional cooling degree days (CDD), according to NatGasWeather." 


 I  concur with this as I, myself, noted cooling models/forecasts. The forecast I saw had notable CDD losses in the 6-10 day period, which is consistent with the bolded. Days 11+ were near flat. So,  I'm confident that a cooler 6-10 day period was the main wx influence today as that was dialed in leading to new selling.


By metmike - July 12, 2018, 3:48 p.m.
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Should temperatures go up in the 2 week forecast, I think that natural gas will get some good support. For the following reasons:

1. Storage is 700 bcf behind last year and 500 bcf behind the 5 year average.

2. The price is testing an uptrend line going back to the lows in December 2017. 

3. Seasonal weakness from mid-June to mid-July is wearing off. 


However, should the much cooler temps invading the Midwest next week encompass a larger area for a longer time, the long lived 7 month uptrend could(should) be broken. It's barely holding at the moment and it won't take much additional cooling to break thru. 


Working Gas in Underground Storage Compared with Five-Year Range

Erdgas Future saisonal

By metmike - July 12, 2018, 5:20 p.m.
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After the bullish EIA number was out, the market did some buy the rumor, sell the fact type action as next weeks number is not going to be so bullish and we are trading the future now.

The 12z GFS came out with much warmer maps for the 10-12 day period, mainly from slowing down the same cold front on previous runs and allowing heat to surge in for several days ahead of it.  This allowed ng to pop back up near its highs from just after the EIA number came out, th3n we finished weak..........as the overall pattern, especially noted in the 6-10/8-14 day has significant cooling in the Midwest.....despite the 12z GFS outlier solution of the 3 day heat surge during that period.


From Natural Gas Intelligence after the close:   

Lean EIA Build Can’t Spark Natural Gas Futures Rally; SoCal Spot Strengthens

                       Natural gas futures pulled back Thursday as weekly government storage data came in tighter than surveys but not enough to