Daily Market Update December 20, 2019
Early Morning Update
The Jan20 natural gas contract is trading up $0.06 at $2.33. The Jan20 crude oil contract is down $0.55 at $60.63.
Summary
The market ended the day flat yesterday despite the bullish storage report. The EIA reported a draw from storage of 107 Bcf - well above most estimates. The higher draw indicated higher demand and perhaps a reflection of the lower production we’ve seen over the past two weeks. Either way, the market largely shrugged off the news and ended down $.013 to close the day at $2.273. Longer-term pricing also fell yesterday. We saw the Cal ‘21 - ‘25 all hit record low pricing yesterday.
In addition to the long-terms moving lower, we also saw some northeast basis pricing move down yesterday for this upcoming winter.
As for weather, forecasts for the balance of the year continue to show above-average temperatures. We’re at the tail end of a cold snap now, but temps are forecast to rise starting this weekend and extending into the first week of January.
Looking to next week, expect low market liquidity and potentially quiet markets as traders head home for the holidays.
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