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Daily Market Update December 19, 2019

Early Morning Update

The Jan20 natural gas contract is trading down $0.04 at $2.25.  The Jan20 crude oil contract is up $0.07 at $61.00.

Summary

he January '20 NYMEX prompt month contract shed 3.3 cents by the end of yesterday's trading, settling at $2.286/MMBtu. The remaining winter strip of Jan-Mar '20 also echoed a similar sentiment and lost 3.5 cents. The deepening depression of near-term natural gas prices is unsurprising to see, due to the abundance of warmth that's forecast for major demand centers over the next 15 days. For those hoping for a white Christmas, you might be disappointed as the central and eastern portions of the U.S. are forecast to be significantly warmer than normal (5-8 degrees above average). Despite a very mild start to winter so far, market forecasts are advertising a greater risk for a backloaded winter, meaning a higher chance of below-average temperatures to roll in during February and March. Unless we experience a prolonged period of extreme cold, we are at a good spot to temper extreme price volatility due to healthy storage levels. The EIA will release their weekly storage report later today. Market participants are expecting a 92 Bcf withdrawal to be reported, which is smaller than both last year and the 5-year average.

Market Update121919

Market Settles 121819

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