Natural Gas Still Can't Find A Floor

The March natural gas contract continued its march lower today, settling down almost 3% as weather forecasts warmed and cash prices were even weaker today. 

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natural gas commodity weather

It was the fourth straight trading session where the March natural gas contract settled lower and the fifth in the last six sessions. Weak cash prices definitely played a role in this move lower. 

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natural gas commodity weather

Lingering concerns following a very loose EIA print last week did too. 

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natural gas commodity weather

As we noted in our Morning Update, forecasts warmed decently from Friday afternoon, with much of the warming actually coming overnight last night after only a very small gap down last evening. 

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natural gas commodity weather

Climate Prediction Center forecasts this afternoon again showed cold risks struggling to roll forward, with key regions in the South and Southeast likely staying warmer through Week 2. 

natural gas commodity weather

This selling comes as traders shake off what should be a very large storage withdrawal to be announced by the EIA on Thursday. Severe cold swept through the Midwest pulling GWDDs significantly above average for the week. 

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natural gas commodity weather

We broke down our expectations for the draw in our Natural Gas Weekly Update today, which outlines all fundamental aspects of the natural gas market. In it we also looked at the current state of each individual storage region relative to the 5-year average. 

natural gas commodity weather

 

Disclaimer: To begin receiving both our technical and fundamental analysis of the natural gas market on a daily basis, and view our various models breaking down weather by natural gas demand ...

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