Daily Market Update October 1, 2018

Early Morning Update

The Nov18 natural gas contract is trading up $0.06 at $3.07. The Nov18 crude contract is up $0.15 at $73.40. 

Summary

On Friday, the November 2018 NYMEX natural gas futures price depressed by 4.8 cents on the day to settle at $3.008/MMBtu, after trading as high as $3.062/MMBtu that day. Storage continues to disappoint, adding upward pressure to winter pricing. End-of-season storage estimates show 3.26 Tcf, the lowest in about a decade. After seeing record levels of powerburn, those numbers have finally seen some relief with the cooling fall temperatures over the last three days, which fell to 28.6 Bcf/d on Friday. Today, U.S. powerburns are up about 1.1 Bcf/d, with the majority of the demand higher in the Northeast. Weather forecasts show most of the warmer-than-normal temperatures contained in the Northeast, and the complete opposite for the majority of the Northwest, with temperatures falling as low as 15 degrees below the 30-year normal. We should start to see preliminary winter weather forecasts being released over the next couple of weeks. After seeing record setting U.S. dry production, the supply side has also dipped lower, ending the week at 82.8 Bcf/d, but still remains about 10 Bcf/d higher than levels seen last year.

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