Daily Market Update February 26, 2019
Early Morning Update
The Mar19 natural gas contract is trading up $0.04 at $2.88. The Apr19 crude oil contract is down $0.23 at $55.25.
Summary
Near-term natural gas had a small rally on Monday, reacting to updated weather forecasts over the weekend indicating elongated colder temperatures to start March. The prompt month gained nearly 12 cents to $2.836/MMBtu, the 12-month strip rose five cents to $2.934, 2020 ticked up just under a penny to $2.747, and 2021 stayed flat at $2.633. It seems that movement had been relatively centered around the spring and summer 2019 periods, indicating potential concern for available storage as we move through the remaining weeks of the withdrawal season. Demand continues to remain high, with February levels not seen since the polar vortex of 2014. Production is still steady at 85 Bcf/d, but as we are already at a deficit to historical storage benchmarks, the withdrawal outlook for the rest of the winter looks to remain strong. End-of-season storage level projections continue to slip, and are currently at 1,115 Bcf.
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