Daily Market Update September 24, 2018
Early Morning Update
The Oct18 natural gas contract is trading up $0.01 at $2.99. The Oct18 crude contract is up $1.42 at $72.20.
Summary
On Friday, the October 2018 NYMEX natural gas futures price moved slightly higher by 0.1 cent on the day to settle at $2.977/MMBtu. Over the past week, gas has surged almost 25 cents higher, caused by upward pressure due to higher year-over-year powerburn demand levels for natural gas and the large storage deficit to historical benchmarks. The 1-5 and 6-10 day weather forecasts show some cooler-than-normal temperatures contained in the Northwest region, with most of the warmer-than-normal temperatures in the Southeast. The market is awaiting preliminary winter weather forecasts, which will affect prices if they call for cooler or warmer weather. So far for the month of September, powerburns are averaging over 35 Bcf/d, over six Bcf/d higher versus this time last year. As weather forecasts moderate, it is expected that these levels will fall from the recent highs to about 30.7 Bcf/d. Along with the bearish weather forecasts and demand levels, U.S. dry production remains above 82 Bcf/d, and appears to be keeping a cap on pricing just below the $3/MMBtu resistance trading level.
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