Happy Monday
I woke up this morning to the NYMEX October front month contract down overnight and I thought that was the tone for the day. However, at 9:45am the market caught a bid and rallied back up to the $2.40 US/mm resistance area.
October has rallied in a steady uptrend from a low of $2.02 on August 28th to a high of $2.407 on Friday. At the same time, the winter strip is going sideways between a $2.96 and $3.07. There doesn’t seem to be much fear in this market that we won’t have enough gas in storage for the winter.
The two-week forecast for Cooling Demand Days (CDD’s) is 134, compared to 240 a month ago. CDD is a measure of how much air conditioning demand there will be. However, the Heating Demand Days is now in double digits at 18 so Autumn is starting, even if we are not feeling it today in Ontario.
With demand falling off, we ought to see storage injections jump as utilities cram the last gas in the ground before withdrawal season starts.
I monitor the estimates for production and all I can say is that there is a very slight but steady decline in output over the month of about 1 bcf/day from August. Not monumental but steady. [WFG FM]