Daily Market Update August 23, 2018
Early Morning Update
The Sep18 natural gas contract is trading down $0.01 at $2.94. The Oct18 crude contract is down $0.05 at $67.81.
Summary
The NG prompt month saw a slight drop in prices Wednesday closing down $.024 to finish the day at $2.956. The prompt month has been threatening the key $3 resistance level for roughly two weeks, without ever having broken through. The market has defended the $3 level before, notably in mid-June when prices briefly broke through then sold-off. The market is being supported right now by very bullish weather forecasts for the east coast starting this weekend. While the east coast is experiencing a respite this week, significant heat will return and linger for at least a week. This will likely cause higher power burns as air-conditioners get cranked up. And this will not help the already large Y-o-Y storage deficit. End/summer storage estimates are currently ~3.37 TCF, well below last years’ 3.788 and the 5 YA at 3.829.
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