Friday, November 20, 2015

"Natural Gas Falls With Stockpiles and Temperatures Still High"

December futures $2.188 down 8.8 cents.
The last couple week's action:
From the Wall Street Journal:

Prices plummeting to four-week low
Natural gas prices are plummeting to a four-week low as mild temperatures and record-high stockpiles continue a months-long route for the heating fuel.

Futures for December delivery recently traded down 7.7 cents, or 3.4%, at $2.199 a million British thermal units on the New York Mercantile Exchange. The fall would be the largest one-day percentage drop since prices fell to a three-year low in late October and comes on top of a 3% decline yesterday.

Weather forecasts are showing a mix of above- and below-normal temperatures, but moved sharply warmer for next week in many of the largest Midwestern and Eastern markets for gas heating. The popular U.S. weather models moved dramatically warmer overnight, according to Commodity Weather Group LLC in Bethesda, Md., though meteorologists tempered some of those predictions.
About half of U.S. homes use gas for heat, making winter cold the market’s biggest driver of demand. This year, an especially strong manifestation of the weather phenomenon El Nino has many meteorologists calling for a mild winter across the northern U.S. That has many traders expecting low natural-gas prices though the winter, especially after a warm start to autumn.

Without immediate heating demand, natural gas producers are likely to keep sending gas into storage through next week rather than drawing it out to sell for heating fuel, which is what usually happens at this time of year, analysts said. Stockpiles hit an unprecedented 4 trillion cubic feet last week, the U.S. Energy Information Administration said yesterday, adding to the pressure to sell....MORE
Sometimes it's hard to maintain the negativity but we can usually find a way:
Nov. 9
Natural Gas Jumps 4% on So-So Storage Report
Up 9.2 cents (4.07) at $2.354.
If I were a betting man I'd say natty is going to $2.20....
November 3
Natural Gas: The Economics Weaken (COG; EQT; RRC; SWN)
Oct. 26 
Here Comes Your 19th Market Breakdown: Front Natural Gas Drops 10%, Bounces (a little)
Soon to be gone November's: $2.084 -0.202! Low $2.0500.
December: $2.374 -0.119 after trading as low as $2.342.

We'll take a little alliteration victory lap:

Sept. 4 
Natural Gas: EIA Weekly Supply/Demand Report 
As we enter the autumn shoulder season, our obsessive preoccupation with supply gives way to El Niño and whither/whether weather. More on that next week....
That was followed, for the next seven weeks, by almost obsessive reiteration (after a while you can't find new stuff to say, it's just CH4. pretty basic).
Okay, one more:
Sept. 14 
Natural Gas: This Could be The Year Prices Go Down In Winter 
Combine an El Niño winter with an uptick in production and you've got dogs and cats living together, mass hysteria at the NYMEX, etc.... 
Here's the headline at CNBC an hour ago:
Natural gas pounded by supply, warm weather
And FastFT:
MARKETS Warm weather sends natural gas price down 10%
Oct. 23
Long Is Wrong: EIA Natural Gas Supply/Demand Report

And may more, use the search blog box if interested.