Daily Market Update March 11, 2019
Early Morning Update
The Apr19 natural gas contract is trading down $0.08 at $2.79. The Apr19 crude oil contract is up $0.33 at $56.40.
Summary
On Friday, the April 2019 NYMEX natural gas futures price followed the weeks trend of limited volatility, settling 0.1 cents lower on the day to settle at $2.865/MMBtu. Not only was there lack of volatility for April this year, but it appears that the price trend follows the movements seen this time last year. The fundamentals heading into the summer are very similar to those seen last year: higher demand, increased exports, and inventory levels at a deficit to historical benchmarks. The EIA reported a withdrawal right in line with expectations at 149 Bcf, however, this was much higher than the 60 Bcf reported last year for the corresponding week and the 109 Bcf withdrawal over the past five years. Current estimates for the end-of-season storage inventory are at the lowest since 2014. Weather forecasts have moderated significantly in the 1-5 day forecast, with warmer-than-normal temperatures dominating the eastern half of the country, with some lingering cold on the West Coast. The warming temps for major demand center in the U.S. for natural gas could help to keep down the remaining storage withdrawals. U.S. LNG exports have remained steady, climbing to 5.5 Bcf/d on Friday, and exports to Mexico are close behind, at just above 5 Bcf/d. Both exports are forecasted to increase significantly this year. Total U.S. dry production has fallen slightly to 84 Bcf/d.
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