Daily Market Update September 13, 2018

Early Morning Update

The Oct18 natural gas contract is trading up $0.02 at $2.85. The Oct18 crude contract is down $0.67 at $69.70.

Summary

October natural gas futures settled relatively unchanged yesterday, settling up just a tenth of a penny at $2.829/MMBtu. This comes in the face of dipping production, which has slipped 1.4 Bcf/d since reaching an all-time high of 83.7 Bcf/d on Monday, another expected storage injection less than the five-year average, and warmer-than-normal temperatures forecast for the majority of the country, which should keep late summer cooling demand elevated. Power burns are up, as well, with 33.0 Bcf/d projected for today, the highest it’s been in a week. The U.S. Energy Information Administration is expected to report a growth in natural gas storage inventories this morning in the neighborhood of 70 Bcf for the week to Sep. 7. This would be slightly less than the 74 Bcf five-year average, and far less than the 87 Bcf seen last year for the corresponding week. Current stockpiles are in deficit to the five-year average by almost 19%, and the next three injections are expected to do little to pare this down.

Market Update 091318