Happy Storage Day

The EIA reported that for the week ending October, +76 bcf of natural gas was injected into storage. Expectations were for a +77 to +78 bcf build, so this report was in-line.

The NYMEX November front month contract initially rallied this morning, but then sold off.  Last trade was $2.35 US/mm, down 2 cents. The winter strip has made another new low, last trade $2.82, down 1 cent.

For the rest of October, the market is looking ahead to a warmer temperatures and lower demand.  The two-week forecast estimates 115 for Heating Degree Days (HDD), down from the 130s earlier this week.  The 6-10 day forecast agrees with this assessment.  Remember that since we have crossed from Summer to Winter, Red means less heating demand for natural gas. 

The other forecast that came out today is the NOAA 3-month forecasts.  Looking at the Dec-Jan-Feb map, we see the pattern is for a bit above average temperatures, especially when you consider the populations of the different areas.  For example, the below normal forecasts are for Montana/North Dakota where there are fewer people so less demand.