Daily Market Update October 9, 2018
Early Morning Update
The Nov18 natural gas contract is trading up $0.03 at $3.30. The Nov18 crude contract is up $0.51 at $74.80.
Summary
The natural gas market continued its upward spiral on Monday, fueled by bullish weather forecasts, stalling production, concern over end-of-season storage levels, and a hurricane that is threatening Gulf production. The November prompt month steamed upward over 12 cents to settle at $3.267, the 12-month strip gained nearly five cents to $2.946, and the 2019 and 2020 years rose 3.5 and 1.5 cents to $2.878 and $2.675, respectively. The rest of this week sees warmer-than-normal temperatures swathing the East Coast in weather that is three to eight degrees warmer than normal, continuing to stress cooling demand well into October. On the heels of these temperatures, we are seeing Hurricane Michael quickly approaching the Gulf Coast, bringing potential demand and offshore production drops with the excessive amounts of rain expected. Prior to the storm, production finally moved back up over 84 Bcf/d for the first time in over a week, with Northeast production hitting a new all-time high of 30.5 Bcf/d yesterday.
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