Market Updates

Daily Market Update December 15, 2016

Daily market update

Early Morning Update

The Jan17 natural gas contract is trading down $0.05 at $3.49.  The Jan17 crude contract is down $0.24 at $50.80.

Summary

After two consecutive days of losses, the Jan17 natural gas contract settled up 6.6 cents yesterday at $3.540/MMBtu.  With pre-holiday book-squaring contributing to the recent volatility, weather continues to be the primary driver of prices.  However, despite warmer outlooks in the coming weeks, traders appeared yesterday to be positioning themselves ahead of the release of the U.S. Energy Information Administration’s weekly storage report.  The report, due out at 10:30 this morning and covering the week to Dec. 9, is expected to show the first triple-digit withdrawal of the season.  Withdrawal estimates range from 117 to 144 Bcf, with a Bloomberg survey showing a 124 Bcf median estimate and Bentek projecting a 133 Bcf pull.  In the review week to Dec. 10, data from NOAA shows 41.0% more heating degree days compared to last year for the same week, and 5.9% more than normal.  The surplus to last year is expected to switch to a deficit, while the surplus to the five-year average will slip below 6%.  The next two storage withdrawals are projected to be more than twice as large as historical averages, and should completely eliminate the five-year average surplus.

Market Update 121516

Market Settles 121416


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