Market Commentary

Weekly Recap

June 22, 2015

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  • After a few weeks of going back and forth between a trading range of $2.50-$3.10, the NYMEX natural gas market seems to have found a home in the upper $2.70’s to upper $2.80’s. The market started the week off in a bullish trend, but came off later in the week. Eventually settling up around a nickel on the 12 month average and 6.6 cents on the prompt month.
  • While uncertainty around weather conditions and production levels can commonly cause some summer volatility, it is worth noting that the winter 2015-2016 average has been held to a relatively tight trading range so far this season. Since April 1st, this strip has varied less than 40 cents, ranging from the upper $2.90’s to the mid $3.30’s. Last week this strip gained 4.5 cents to settle just below $3.20.
  • An injection of 89 BCF was announced in Thursday’s storage report. While lackluster compared to recent injections, the number was right in line with both expectations and the EIA 5-year average, and also keeps us on track to hit 4 TCF by the end of the injection season.
  • Forecasts for the coming week are bearish with cool weather stretching from Texas up through the heavy consuming region in the Northeast. Some above average temperatures are still expected in the Northwest and Southeast regions of the country.
  • Power prices continued to be relatively quiet last week as most markets shed the small gains they saw in the week prior.