Happy Friday
What a week in the NYMEX December front month contract!
On Monday, we ramped up from last Friday’s close of $2.67 US/mm to $2.92. On Wednesday, we reached a high of $3.02. Then yesterday and today, we sold off to a low of $2.67. Last trade (just after noon) $2.79 unchanged from yesterday
A real roller coaster ride: rush to a new high and a big fall, but the net result of the ride was that we ended up basically where we started.
I think the takeaway is that if you watch the market all day long, you will develop hypertension. The natural gas market is a real volatile beast so better to develop a good purchasing plan and when the market offers you a buying opportunity, grab it because it might not be there for long.
Early estimates are for a +20bcf injection for next weeks report for the week ending today (Nov 15th). If accurate, we would end the injection season with 3,994 bcf of gas in storage in the lower 48 just below the 4 tcf level. What a season! Week after week of below average injections during the summer only to arrive within at the all time high level of working gas in storage.
We have enough gas in storage for this winter. The only question will be if we have a sever cold snap like we did last January… or if we have more than one cold snap.
The NOAA 8-14 day forecast is calling for normal temperatures across most of the US and below normal across Alabama and Georgia. This warm autumn is over, so we are going to see Heating Degree Days being to increase. But we are still a bit below the 10 year average, which makes sense in the broader perspective of this year.
Tropical Storm Sara is just that, a storm, with no expectation of developing further. Going to drop a lot of rain on Guatemala, Honduras, Belize and the Yucatan peninsula with resulting flooding and mudslides. However, predictions are that it will dissipate after that with no threat afterwards. The 2024 hurricane season might be over… but I maybe shouldn’t speak too soon.
Finally, just before you go off to enjoy your weekend look at the USD/CAD. Currency traders are getting in front of the new administration’s economic policies and the US dollar is rallying and the Canadian dollar is falling. We covered this issue in our November Market Fundamentals Report.
Have a Great Weekend. [WFG]