Tuesday, June 19, 2012

Major Commercial Weathercaster Changes Heatwave Forecast: Natural Gas Slumps

This is just #*&@ nuts.
In afterhours electronic trade the futures are quoted at  2.561, down 2.83% from yesterday's close.

After the National Weather Service put out their sober/restrained forecast on Sunday, MDA EarthSat Weather, a service that some big-time energy traders rely on (among other things they are the CME's hurricane futures calculation agent) hyped the upside on Monday:
..."We expect a rapid rise in cooling demand to come from the surge in temperatures by midweek in the East," Bob Haas, weather operations manager for MDA EarthSat Weather, said in a statement from Gaithersburg, Maryland. "Though short-lived, this heat event is likely to surpass any so far this season."...
This afternoon Bloomberg reported:
...July gas in Alberta declined 5.2 percent after MDA EarthSat Weather of Gaithersburg, Maryland, adjusted forecasts to be cooler than previously predicted for the U.S. Midwest and Northeast near the end of the month.

“They seem to be moderating some of the forecasts and, given the thing has run 45 cents in two or three sessions, some profit-taking would make sense,” Martin King, an analyst with FirstEnergy Capital Corp., in Calgary, said in a telephone interview....

...“Temps were cooled slightly late within the Northeast,” Eric Wertz, an MDA meteorologist, wrote in a six- to 10-day forecast today. He predicted “some slight cool changes in the Midwest and & East” in the 11- to 15-day outlook.

The high for New York on June 28 will be 72 degrees Fahrenheit, (22 Celsius) 11 below normal, said AccuWeather.com of State College, Pennsylvania....
We had relayed yesterday's action in "Natural Gas Pops 5% on Weather Forecast".
That post was preceeded by Monday morning's "The Next Big Natural Gas Report is Not This Week's Storage Report":
...Because of the focus on storage it's easy to forget that injections are the residual of production - offtake and that U.S. E&P's are producing at near-record rates.
Any decrease in projected electricity demand could see 10% daily drops in the futures.

NOAA's climate Prediction Center is showing less than torrid temps in the June 17 8-14 day forecast and the June-August forecast although getting dated is not offering any support to bulls...
Good grief.
Yesterday the futures closed up 16.8 at $2.635.