Happy Storage Day
The EIA reported an injection of +40 billion cubic feet of gas in storage for the week ended September 6, which was less than the expected build of +48 bcf. Remember that even though the past few injection reports have been smaller than average, there is still plenty of working gas in storage (3,387 bcf reported today, which is 296 bcf more than the 5-year average of 3,091 bcf for the week). It’s unlikely that there won’t be enough gas stored for winter. That being said, a miss is a miss and this was a bullish report for the NYMEX October front month contract, which rallied 9 cents to $2.36 US/mm. This is a breakout of the line I drew on the chart, but I would suggest we wait until Monday just to make sure that this isn’t a head fake. The winter strip rallied only 2 cents to $3.05, so it has not followed October’s example and is staying close to recent lows.
The other big event is Hurricane Francine, which made landfall yesterday as a Category 2 hurricane in Louisiana, but has since weakened into a tropical storm. Although the storm has brought flooding rainfall to the area, Reuters suggests that its impacts to the natural gas market will be limited.
The NOAA 6-10 day forecast is for warmer weather in the Michigan & Minnesota area (and I hate to say it but Ontario region), but Arizona is looking cold (okay, cold for Phoenix is 90F). Summer is staying with us, but rest assured that it will cool off. (But no guarantee that it will get cold.) [WFG FM]
