Friday saw a huge impact on natural gas futures, but it was able to post tangible gains for weeks. It was a volatile week in the net gas complex, with the near-term futures contract down 21.3 cents on Monday and the December issue with an almost equal gain.
The near-term futures contract was successful over the weekend due to the expectation of an improvement in the volume of liquefied natural gas (LNG) and a lighter government storage build.
Last week, December natural gas futures rose $ 0.12 or + 3.90% to 2 3.277.
U.S. Energy Data Management Weekly Collection Report
The EIA report for the last week of the week, which ended on September 18, was lighter than expected last week and price action indicates that traders were expecting a rebound.
The EIA reported on Thursday that domestic supply of natural gas has increased by 66 billion cubic feet (BCF). That was lower than the 77 BCF forecast increase by analysts suggested by the S&P Global Plate. The government said total shares now ago. at 80 trillion cubic feet (TCF), up 404 BCF from a year ago and 707 BCF from a five-year average.
There was a lot of interest in this report because traders wanted to know if the print was more inconsistent or a reflection of the loser market than the previously reported large-scale.
Last year, the EIA recorded 97 BCF builds for this period, and the five-year average is 80 BCF injections.
Short-term weather outlook
From 28 September to 1 October, according to Nat Gasweather, “Beta shipwrecks continue to move southeast as the rains continue to move eastward. As the cold rains continue in the north-west, the plains with elevations of 90 to 100 remain warm to the south-west.
High pressure will rule most of the rest of the U.S. early next week, with a comfortable next in the ’80s. There will be a major pattern change in the middle of next week, as the coolest shots of the early season come in the mid-40s and 60s in the Midwest and Northeast, while the West is hot with an altitude of 80 to 100. Overall, national demand will be low earlier this week, then moderate to high.
Nearby Period Outlook
All eyes are on short-term weather forecasts and LNG. To continue on demand. The weather could be volatile throughout the week with mild demand demand with some forecasts earlier this week, followed by an early season cold snap in the eastern part of the U.S. in the middle of next week for a surge in national demand. Meanwhile, warmer conditions will continue towards the west.
While we expect a weather-related uptick, we also expect benefits to be limited as bearish weather is expected to take a pattern turn in most parts of the US from October 5 to 10.M. Traders tend to pay attention for at least two weeks, so this report will be focused.
Signs of encouragement on the LNG front will also be a tool of interest along with the weekly EIA storage report. According to Bespoke Weather Services, “This number (EIA’s 66 BCF build) reflects a very tight balance – we have the strongest peers in our data throughout the summer.”
Ultimately, to sustain the rally in delayed futures contracts, we need to look at lower builds and the average range in rising LNG exports. Otherwise, there is a risk of storage control problem and it will weigh on prices.
