Daily Market Update September 4, 2018

Early Morning Update

The Oct18 natural gas contract is trading down $0.07 at $2.85. The Oct18 crude contract is up $0.50 at $70.30.

Summary

Ahead of the holiday weekend, natural gas futures strengthened on high near-term temperatures and the expected continuation of meager gas storage levels. October 2018 increased four cents to $2.916/MMBtu, the 12-month strip gained three cents to $2.837, and the 2019 and 2020 years have risen 2.7 and 1.9 cents to $2.787 and $2.636, respectively. Weather on the coasts is expected to exceed normal temperatures by 3-5 degrees for at least the next two weeks, continuing a strong, if not record-setting, demand period. Production is helping to offset this at least a bit, as a new all-time high level was set on 9/2 at 83.4 Bcf/d. Storage levels have not recovered, and the historical comparisons for the next three weeks look to extend and even potentially deepen the storage deficit.

Market Update 090418