Daily Market Update April 18, 2019
Early Morning Update
The May19 natural gas contract is trading down $0.01 at $2.51. The May19 crude oil contract is up $0.09 at $63.85.
Summary
The prompt month continued its descent yesterday, losing another 5.5 cents and settling at $2.517/MMBtu, the lowest prompt month settle since June 8, 2016. Falling demand due to mild temperatures continues to be the main driver pushing prices lower, dropping almost 5.0 Bcf/d since Monday, and projected to continue to fall over the next two weeks. Most of the decline in demand this week came from the res-comm sector, as temperatures across the nation moderated to levels which have kept both heating and cooling demand repressed. Aiding the downward price pressure has been strong natural gas production, which has averaged 86.6 Bcf/d so far this month, 8.1 Bcf/d higher than last year at this time. All of these bearish fundamentals have combined to produce a strong start to the storage-building season. Natural gas stockpiles were expected to have grown 96 Bcf in the week to April 12, much higher than the 23 Bcf withdrawal seen last year for the corresponding week, as well as the 21 Bcf five-year average injection. The deficit to last year will most likely be erased over the next two weeks, much sooner than previously anticipated.
Loading please wait...