Daily Market Update November 4, 2019
Early Morning Update
The Dec19 natural gas contract is trading up $0.10 at $2.81. The Dec19 crude oil contract is up $0.55 at $56.75.
Summary
On Friday, the November 2019 NYMEX natural gas futures price surged higher, up 8.1 cents on the day to settle at $2.714/MMBtu, and marks the highest the prompt month has traded since the beginning of April this year. This followed a bearish storage report of 89 Bcf, which was the 14th consecutive injection into storage that was above the five-year average. Storage levels this season increased at the highest rate since 2015. Significantly colder weather is forecast to dominate the majority of the country over the next couple of weeks, with the biggest change to the forecast seen later this week into next week, where another powerful cold front is expect to make its way from the upper Midwest to the East Coast. It is the time of the year where power burns continue to dip, and residential and commercial demand picks up, almost matching the lost demand from natural gas used for power generation. Res/comm demand levels are expected to increase with the colder-than-normal temps. U.S. dry production is averaging just over 92.0 Bcf/d for the first few days this month, with current levels about 1.0 Bcf/d below the all-time high reached late last month.
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