Natural gas markets completely reversed as we saw the NYMEX fall $0.17 USD/MMBtu or 4.8% to settle at $3.33 USD/MMBtu. This drop wiped out the significant gains we had seen over the first two days of the week. Market volatility is expected to remain in the coming weeks as traders await the first signs of winter. This downward movement returns the market to a more fundamentally supported price point.
Lower 48 production edged up today but is still on pace to hit a 13-week low of 104.7 bcf/d. LNG flows returned to near record volumes of 16.7 bcf/d. Demand forecasts in the lower 48 continue to indicate normal to above normal temperatures in the coming weeks. Alberta is posed for a moderate cold shot starting on Sunday with temperatures reaching as cold as -6°C. This should help support AECO cash prices to rise above the $1.00 CAD/GJ mark for the first time since September 9th. (PB)