Tighter Balances And Stronger Cash Lift Natural Gas Prices

For the fourth time in the last five sessions, natural gas prices have posted gains, with the June contract closing 4.5 cents higher today.

It was not immediately clear that we would see such a day, however, as prices initially moved down early in the morning, but the fundamentals data looked quite impressive this morning. Production, which often shows a ramp up in the data at the end of a month, stayed well off its highs, for one.

We also saw LNG exports tick back up, inching closer to their record high levels.

This data, plus some impressive burns thanks to the current heat in the southern U.S. led us to go with a slightly bullish outlook in our early morning update.

Sure enough, we began to rally quickly as the market digested the new supply / demand data, with the rally continuing as cash prices came in stronger than yesterday, continuing their gradual upward climb.

As we look to the weather side, we see the current elevated demand levels, especially relative to this time last year, though overall demand heads a little lower once into next week.

There remains some elevated warmth in the Southeast next week, however, as seen in the current 6-10 day outlook.