Daily Market Update March 27, 2018

Early Morning Update

The Apr18 natural gas contract is trading up $0.03 at $2.65. The May18 crude contract is up $0.29 at $65.84.

Summary

Natural gas rose across the board on Monday, as weather forecasts show colder temperatures on the horizon for most of the country. The April natural gas contract, which expires at the end of today’s trading, gained nearly three cents to $2.618, the 12-month strip rose two cents to $2.82, and 2019 and 2020 were up less than a cent to $2.78 and $2.75, respectively. Temperatures throughout the Midwest and East Coast look to be from three to eight degrees below normal to start out the month of April, with relief expected around the tenth of the month.  Production set a new all-time high on Sunday at 78.4 Bcf/d, but is expected to dip below 78 Bcf/d, on average, for the next week. Feed gas for the Cove Point LNG export terminal has increased exponentially since this weekend, indicating preparations for its second shipment are well underway as an empty tanker moves towards Maryland. As the withdrawal season dwindles to a close, final end-of-season estimates should tighten and should soon indicate the starting point for this 2018 injection season.

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