Daily Market Update August 25, 2017

Early Morning Update

The Sep17 natural gas contract is trading down $0.03 at $2.92.  Oct17 crude is up $0.17 at $47.60.

Summary

Yesterday, the U.S. Energy Information Administration reported a 43 Bcf injection into natural gas storage inventories for the week to Aug.18.  This was much higher than the 12 Bcf build seen last year for the corresponding week, but bullish compared to the 53 Bcf five-year average.  Despite being slightly less than estimates, the report had little overall effect on prompt month prices.  Natural gas futures for Sep17 settled the day up two cents at $2.949/MMBtu, but had been trading three cents higher than yesterday’s close before the release of EIA data.  The 2019-2023 calendar strips all closed lower, with the back of the curve having the steepest declines, and 2021-2023 settling at all-time lows.  Mild weather outlooks for the eastern two-thirds of the country through the Labor Day weekend should help increase storage-building in the weeks to come, as end-of-season projections are starting to increase and may approach 4.0 Tcf.  Hurricane Harvey is projected to make landfall on Friday near Corpus Christi, TX, bringing life-threatening and devastating flooding near the coast due to 6-12 foot storm surges and rain accumulation from 15 to 25 inches.

Market Update 082517