Daily Market Update December 21, 2018

Early Morning Update

The Jan19 natural gas contract is trading up $0.12 at $3.70. The Feb19 crude contract is down $0.42 at $45.46.

Summary

Another volatile day in the NYMEX yesterday with a large swing in the prompt month.  Prices opened the day much higher, reaching $3.938 at one point, before dropping throughout the day to close at $3.583.  The EIA reported a draw of –141 Bcf, which was not a bearish report so the drop is somewhat difficult to understand.  But it does highlight the volatility at the front of the curve, and the speed at which prices change direction.  Weather forecasts certainly haven’t trended bearish as the temps into the second week of January are trending cooler than normal, as is the case again this morning.  For now though, we’re expecting milder conditions through the end of the year, and expectations for the next two storage reports reflect that.  A draw in the mid 40’s is expected for next week, and one in the low 60’s for the following week.  The next storage report will be delayed one day to Friday at 10:30 ET due to the holidays.

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