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DAILY NATURAL GAS SETTLEMENTS
The NYMEX natural gas market started the week off with a dip that would take the 12 month average below the $3.00 price point and send the prompt month down into the low $2.70’s. The market tried to rally on Thursday but ultimately failed to do so. The market lost about 4.5% on the week with the 12 month strip settling under $2.90 for the first time in almost 3 months.
It is important to note that while we have seen significant downward movement on the stock market, the natural gas bearishness that started Friday and continued into Monday may or may not be correlated to this movement. Economic factors certainly play into trading on the NYMEX, but recent upticks in production and bearish winter forecasts could also be reasons for this dip.
LAST WEEK ON THE NYMEX
Last week the winter 2015-2016 average dipped below $3.00 for the first time since April. The strip settled at $2.964, down over 15 cents from the week prior. Keeping a watchful eye on the potential demand impacts of El Nino (El Nino means warmer weather and thus a reduction in natural gas demand) will be key as winter approaches. This year’s El Nino is forecasted to be one of the strongest events in almost 20 years.
NATURAL GAS IN US STORAGE
Thursday’s storage report announced an injection of 53 BCF into storage, bringing storage levels above 3 TCF. The injection came in below expectations which were in the 57-62 BCF range.
WEEKLY COMMODITY CHANGES IN POWER MARKETS
Power prices did not see the dip that natural gas prices did last week. Most markets were completely flat with New York City continuing its recent climb. Forecasts for the remainder of the summer remain consistently warm.
NOAA 6-10 Day Outlook
The comments made above regarding the NYMEX futures market are the sole opinion of the author, not necessarily the opinions of Interstate Gas Supply, its officers or its employees. Information provided in this “Market Update” is for illustration purposes only, and neither the author nor Interstate Gas Supply shall be liable for any information contained herein.
IGS Energy provides weekly analysis and market updates on industrial and commercial natural gas news. We cover natural gas prices, futures, and national storage information, giving you the most accurate market data.
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