Market Updates

Daily Market Update - August 23, 2016

Daily market update

Early Morning Update

The Sep16 natural gas contract is trading up $0.04 at $2.72.  The prompt crude contract is down $0.51 at $46.90.

Summary

In the first trading session of the week, the latest weather forecasts, showing a return to warmer-than-normal temperatures for major portions of the country, helped push up natural gas prices.  On the expectancy of strong demand in the weeks ahead, the prompt month rose 9.5 cents, settling at $2.679/MMBtu, and all but erased the nine cent decline seen on Friday.  The lingering warm weather should continue to limit storage injections for the next few weeks, making it less likely to set a new record high for the end-of-season storage levels.  The U.S. Energy Information Administration is still projecting a storage level of 4,042 Bcf at the end of October, which would beat last year’s all-time high of 4,009 Bcf, but is becoming more doubtful as we head into the shoulder months.  Cold winter weather, combined with lower levels of gas in storage at the beginning of the heating season, could tighten the supply/demand balance enough to push natural gas prices higher.  Dry production, which has been making a slow comeback over the past few weeks and reached 72.2 Bcf/d yesterday, could help to counter the anemic pace of storage growth in the final weeks of the injection season.

Market Update 082316

Market Settles 082216

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