Daily Market Update January 12, 2018

Early Morning Update

The Feb18 natural gas contract is trading up $0.06 at $3.14.  The Feb18 crude contract is down $0.34 at $63.46.

Summary

Yesterday, the EIA reported the largest withdrawal from storage on record, -359 Bcf.  The massive draw was a result of extremely high demand due to arctic temperatures and lower production due to wellhead freeze-offs.  The higher demand and lower supply forced storage down to 2,767, well below last year and the 5-year average.  The end-of-winter storage estimate is currently forecasted at 1.3 Tcf, the lowest in several years.  Because of the large reported draw, the prompt NG contract finished up sharply yesterday, gaining $.178 to close above $3, at $3.084.  
Weather forecasts for the next week look to be cold again on the east coast (although not as frigid as last week), but then another warm-up is forecasted for the following week.

Market Update 011218