Front futures 2.2770 down .2350 (9.36%)
From Natural Gas Intelligence:
Natural gas futures were down sharply in early trading Monday as forecasters highlighted major warming trends from weather models over the holiday weekend showing mild temperatures well into January.
As of around 8:50 a.m. ET, the January Nymex contract had plummeted 26.3 cents to $2.255/MMBtu. February was down 22.8 cents to $2.284.
Models over the weekend shifted toward a stronger positive Eastern Pacific Oscillation and a weaker North Atlantic Oscillation (NAO), signaling more warmth, according to Bespoke Weather Services.
The changes “resulted in a massive decrease” in the firm’s forecasted gas-weighted degree days (GWDD), “as the next two weeks alone look to be 25-35 GWDD warmer, or roughly 60-70 Bcf,” Bespoke said. “…Perhaps the back half of January can at least get back toward normal, but the first half now looks very solidly warm.”
Weaker prices as the market digests the milder temperature outlook should “tighten balances once again, so if the blocking can ever finally at least back us away from the high-end warmth, there may be a good buying opportunity soon.”
The latest forecast maps from Maxar’s Weather Desk early Monday showed warmer-than-normal temperatures sprawled across the eastern two thirds of the Lower 48 from Jan. 7 through Jan. 11....
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