Gas markets rallied today, as the Jan-26 contract became the NYMEX front month. Colder weather forecasts, strong storage withdrawals, and the start of the new contract propelled the front month up $0.08 USD/MMBtu or 1.7% to settle at $4.56 USD/MMBtu. Despite the rollover, the January contract is still trading $0.08 USD/MMBtu below the front month three-year high, settled on November 13th.  Should cold weather materialize next week as forecasted, expect that contract to rise well past that recent high.

The EIA storage report showed a bullish withdrawal volume of 11 bcf last week. The WSJ survey only forecasted a 1 bcf withdrawal. Lower 48 storage currently rests at 3,935 bcf, 32 bcf or -0.8% lighter than last year; and 160 bcf or 4.2% heavier than the five-year average. Dawn cash prices rallied past $5.25 CAD/GJ for the US Thanksgiving weekend as the last bit of warmth is ending in Ontario and consistent winter weather begins. The continued advancement of the Russia-Ukraine peace talks provides bearish support to gas markets. (PB)