Natural gas prices declined another 2.5% today after gapping up modestly last evening. Prices lingered up into this morning before a wave of morning sellers hit prices hard, and we were unable to recover losses through the trading day, settling just a couple cents off the lows. 

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Cash prices were not quite as pressured, actually rising slightly after Friday's intense selling. 

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The result was another decline in the prompt/cash spread, which was near the top of its range to close out last week. 

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Despite intense selling along the entire natural gas strip, F/G was relatively firm, indicating it is not near-term weather that appeared to be driving price action (as significant cold is still forecast to pull heating demand above average over the next 2 weeks). 

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Rather, it appears the market initially reacted to bullish weather expectations last evening, when it gapped up on weekend GWDD adds. This fit with our analysis in our Friday Pre-Close Update, where we warned clients that bullish weather risks over the weekend would likely allow prices to remain elevated headed into the next week. 

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Yet in that same report we similarly warned that the natural gas technical picture was deteriorating heading into the weekend. 

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Clearly, weather was unable to bail us out today, and the entire strip moved another leg lower. For those looking further along the natural gas strip, this was not much of a surprise, as selling on Friday hit not just the front of the natural gas strip but also contracts into 2019, as seen in our Morning Update today. 

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This would seem to indicate that the market focused more on long-term supply/demand balance than weather today, though we have noticed a varied role for weather in price act