Market Commentary

Market Commentary

Weekly Recap - Week Ending 2/5/2016

Stay up to date on the latest information and changes that may impact natural gas and electricity pricing with the Market Commentary. Download a PDF version of this week’s Market Commentary here.

LAST WEEK ON THE NYMEX

Last week further established that the NYMEX natural gas market is heavily focused on weather right now. While warm winter weather drove the prompt month back down toward $2.00 throughout most of the week, some bullish forecasts turned things around on Friday with the prompt month gaining back a little less than a dime. The week settled with the prompt month down about 10% and the 12 month average hovering around $2.40.

DAILY NATURAL GAS SETTLEMENTS

NATURAL GAS IN US STORAGE

Thursday’s storage report brought news of a 152 BCF withdrawal from natural gas storage. The withdrawal was only slightly above expectations, but the initial bullish reaction was compounded on Friday due to cooler forecasts for February resulting in a reversal of the recent downward trend.

NOAA 6-10 Day Outlook

NOAA’s 6-10 day forecast looks a little more like winter this week. Some of the only deep blue we have seen on the map so far this season is present in the Mid-Atlantic region of the country with well below average temperatures expected from New York City down along the coast to the Carolinas. The western half of the country continues to expect warmer than average weather.

WEEKLY COMMODITY CHANGES IN POWER MARKETS

Power prices followed a similar path as natural gas prices last week as prices dipped throughout the first part of the week, but took a turn later on when some bullish forecasts of potentially sustainable cold hit late in the week. However, this turnaround was not enough to offset the losses from earlier in the week and most markets settled down between 2-3%.

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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