Daily Market Update March 22, 2018
Early Morning Update
The Apr18 natural gas contract is trading up $0.01 at $2.65. The May18 crude contract is down $0.37 at $64.80.
Summary
Snow is once again blanketing the Northeast, as yet another nor’easter pushes through the area, bringing heavy snowfall and accumulations. Temperatures remain below normal, but are expected to warm up marginally heading into next week before falling, once again, into below-normal territory as we move into April. The gas market gave a little back yesterday, as the session closed down 3.7 cents to $2.638/MMBtu. Production continues to be strong, heading off concern stemming from storage levels that lag, both, last year and the 5-year average. Changing weather outlooks have been driving volatility in the near-term gas markets, while longer term strips have been more stable. Calendar strips 2019-2021 have found resistance near $2.75, and have been in a roughly 15-cent trading range since the start of last year. The market is expecting an 88 Bcf withdrawal from storage when the EIA releases their weekly storage report. With 3-4 weeks of withdrawal season remaining, end-of-season estimates are narrowing to around 1.4 Tcf, providing ample room for injections this summer in preparation for next winter.
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