Daily Market Update July 31, 2017

Early Morning Update

The Sep17 natural gas contract is trading down $0.09 at $2.85.  The Sep17 crude contract is down $0.21 at $49.50.

Summary

Friday marked the debut of the Sep17 natural gas contract as the prompt month, and saw prices fall 2.6 cents to $2.941/MMBtu. Cooling weather forecasts for the majority of the country have created most of the downward pressure on prices, which outweighed the slight gain seen on Thursday due to a smaller-than-expected injection into storage last week. So far this summer, storage inventory levels are still at a surplus to the five-year average, and have kept prices in check for large gains in the market. However, there is still a chance, if August heats up, to see an inverse effect on these levels and prices. Power burns remain down year-over-year at a 7% deficit, but had increased over the past couple of weeks with the warmer temperatures seen earlier this month. Natural gas production has bumped up to around 73 Bcf/d, adding more bearish pressure for prices to fall. The EIA is still projecting an end-of-season inventory level of 3.94 Tcf, compared to the 3.8 Tcf expected by the American Gas Association.

Market Update 073117 

Market Settles 072817