Daily Market Update May 2, 2019
Early Morning Update
The Jun19 natural gas contract is trading down $0.03 at $2.59. The Jun19 crude oil contract is down $1.50 at $62.10.
Summary
With the Northeast leading the way, U.S. dry production dropped 1.1 Bcf/d day-over-day to 85.7 Bcf/d today, down from a weekly high of 87.3 Bcf/d on Monday. Although total U.S. demand for natural gas is down slightly from yesterday, power burn has been averaging 28.0 Bcf/d so far this month, up 3.0 Bcf/d from last May and a record start for the month of May. NYMEX natural gas prices reacted bullishly yesterday, with the prompt month gaining 4.5 cents to settle at $2.62/MMBtu. The market is anticipating the first triple-digit build of the year, as well as the seventh consecutive above-average storage injection to be reported by the U.S. Energy Information Administration this morning for the week to April 26. Storage replenishment is off to a strong start, getting a four-week head start compared to last year. Market estimates ranged from 87 to 127 Bcf for this week’s report, with a consensus formed around a 118 Bcf injection. A build at consensus would increase the surplus to last year to 123 Bcf (9%), and further cut the deficit to the five-year average to 321 Bcf (18%).
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