July natural gas prices fell around 1% today as forecasts over the weekend moderated decently.
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The role of weather can clearly be seen in today's price action with losses by far the most significant at the front of the natural gas strip.
Our Morning Update for clients showed these weekend changes well.
It similarly turned our natural gas-driven sentiment slightly bearish for the day even as prices were slightly up, as weekend GWDD losses were seen significant enough to hit prices today.
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Afternoon model guidance did little to save prices as well, and the result was a solid widening of the V/F spread on the day as the July contract ground lower.
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All this comes as traders are beginning to focus on a Thursday EIA print that includes the Memorial Day holiday weekend. Accordingly, the question becomes "how loose" the print will be as holiday demand destruction will certainly result in a larger storage injection than we would normally see with last week's heat. Even with the holiday, Dominion Transmission (DTI) announced a slightly smaller injection than was seen the previous week.
Meanwhile, Columbia Gas Transmission (TCO) actually announced a larger injection week-over-week, with the holiday likely playing a large role.
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