Daily Market Update October 24, 2019
Early Morning Update
The Nov19 natural gas contract is trading up $0.03 at $2.31. The Dec19 crude oil contract is down $0.17 at $55.80.
Summary
Minimal NYMEX price movement was seen on Wednesday, as the November prompt month gained only a penny, closing out the day at $2.282/MMBtu. A similar feeling was echoed by the back of the curve, with the '21-'25 calendar strips all remaining mostly flat and losing less than a penny. Cal '20 was the exception and lost two cents yesterday. Short-term weather forecasts are still projecting above normal temperatures for the East Coast over the next 10 days, which is bearish for the market right now. With the East Coast being a high demand center for natural gas, the above-normal temperatures are tempering the need for heating demand. The slow onset of heating demand, coupled with strong storage injections and high production levels, are a perfect storm for bearish market conditions, which is exactly what we're experiencing right now. Later on this morning, the EIA will release their weekly storage report, where the surplus to the 5-year average is expected to continue to grow larger. The market is predicting an 88 Bcf injection from last week, which is 15 and 26 Bcf higher than the 5YA and last year's build, respectively.
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