Thursday, August 29, 2013

"Natural Gas Storage Tealeaves for 8/29/13"

From yesterday's"Natural Gas: So effing Close to the Target":
So what to do? September's are expiring today and the next storage report is going to be more price supportive than we've seen in the last couple weeks so the best guess is up but jeez I wish we'd seen $3.61 so I wouldn't have to think....
I got to put on my obsfucating academic hat and say "price supportive".
$3.6240 last.

From Energy Metro Desk via the CME:

Previewing the Energy Information Administration's 8/15/13 report.
Each week, we poll 40 professional storage forecasts for our weekly Natural-Gas Storage Box Scores (as seen in each bi-weekly issue of Energy Metro Desk*). This is North America's biggest and most comprehensive natural-gas storage survey and report.

Editors Forecast This Week: +66 Bcf
Average: +63.4 Bcf
Median: +63 Bcf
Range: +57 to 70 Bcf

Natural Gas Storage Tealeaves for 8/29/13
Once EIA's 57 Bcf surprise we were treated to last week had a chance to sink in a bit, we had a fairly good sense that this week would feature a small, semi-corrective surprise as well. The Early View report from last Friday featured a very wide range (55 to 77 Bcf) and that report's standard deviation was again unseasonably high at 6.2. The week before (another surprise report week) we saw a SD of 6.5. Weather was a little funny last week as well; the temperature drop-off in key regions was significant. But, as this week wore on, a different picture emerged. First, the range tightened up fairly quickly to a fairly tight 57 to 70 Bcf; and, the range between the three categories we track really tightened up: we note a very tight 0.9 Bcf spread between the three categories. This week's standard deviation is a low 3.1 - the lowest we've seen in 7 weeks. So, taken together, we'd say the EIA should come in right with the consensus at slightly over 63 Bcf. Our EMD Average was 63.4 and the average among the six big surveys we track was 63.3. We also note that our EMD All-Stars forecast has been tearing it up lately. All Stars forecast is at 62 this week. The Bentek Flow Model came in at 62 Bcf this week; though its S/D Model was much higher at 69 Bcf. Bentek sees high-side risk. On the other hand, the good folks at Genscape (at 65 Bcf) see risk to the low side of their forecast. The editor (at 66 Bcf) was hinting at low 60's coming into the week, but, eventually added a few to the mix to make up for EIA's short suit in last week's report. We think 61 to 66 Bcf should be right on the money; no surprises are anticipated. ** One final shop note for the week. We decided to toss out the EIA's 96 Bcf surprise report number from August 8, and instead we've accepted the would-have-been build of 82 Bcf. It was fairly well argued to us by several analysts this week that the surprise that occurred due to a paper reclassification change is impossible to anticipate or track (unlike a correction or revision) and so weekly boxscores should not be penalized. So, we updated the EIA report number and adjusted everybody's score. -the editor

Weather Tealeaves
Forecast Courtesy of the Commodity Weather Group (
Thought of the Day: European Drops the Rebound
The big story this morning is that instead of rebounding another surge of warming into the Midwest later next week behind a transient cool push, the pattern stays on the cooler side overall on the guidance consensus, leading the way to more significant cooler changes for the Midwest and East through the 6-15 day....MORE
Here's this morning's action: