Market Updates

Daily Market Update - March 10, 2016

Daily market update

Early Morning Update

The Apr16 natural gas contract is trading up $0.03 at $1.78.  The Apr16 crude contract is up $0.01 at $38.30.

Summary

Short-covering, an increase in power burn, and slowing production combined to give natural gas prices a boost for the fourth straight session.  Traders have been buying to cover short positions lately, taking advantage of prices that reached 17-year lows after falling more than 30% from their January highs.  Bentek Energy has reported that gas used in the power generation sector was up 0.8 Bcf/d day-over-day yesterday, and production fell by 0.5 Bcf/d.  Production is expected to be down another 0.3 Bcf/d today, as low prices continue to force natural gas producers to shut down rigs and slow their operations.  It’s Thursday, so the market is anticipating the U.S. Energy Information Administration’s weekly storage report, due to be released at 10:30 this morning.  Estimates for what could possibly be the final pull of the season center around a 61 Bcf drop in storage levels for the week to March 4.  This is almost a two-thirds less than what was reported last year for the same week, and about half of the normal amount for this time of year.  As of this morning, Bentek’s projection for next week’s storage report is a mere five Bcf withdrawal, and has wavered between zero and five Bcf the past few days.  Next week’s storage report for the week to March 11 will show either the last withdrawal of the season, or the first injection of summer.

Market Update 031016

Market Settles 030916

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