Natural Gas Fundamental Forecast – May 27, 2016

Natural Gas dipped 5 points to 2.176 as traders sold off the commodity ahead of the weekly inventory report. NG rallied most of the weak as summer weather has arrived and oil prices regained some momentum sparking a commodities rally.  Natural gas futures closed higher on Wednesday, rebounding after they hit a one-month low in the prior session as forecasts for mild weather hit demand expectations for the commodity. Natural gas futures saw a bounce in early spring amid cooler weather, now these gains are being erased due to an extended, mild spring.

Demand for natural gas spikes in the winter, while summer can also be a high-demand season. Natural gas is used by utilities to generate electricity, and is also used directly in the heating of some homes.

The natural gas market remains oversupplied after a mild winter meant little demand for the commodity to heat homes.

The 88% rebound of US crude futures since hitting a 13-year low in February widened the spread between oil and natural gas to its highest level in 20 months on Wednesday. The widening spread could prompt a shift in US production, as drillers tend to seek more valuable oil and natural gas liquids instead of dry gas when oil prices are relatively high.

Natural Gas Weekly Weather Outlook (natgasweather.com)

May 23-29th: Weather systems will impact the NE Coast, N-C US, and Northwest this week with heavy showers and thunderstorms. Although, temperatures will gradually warm over the Great Lakes and Northeast into the 70s and lower 80s, while it will remain mostly in the mid-80s over the southern US, and only locally into the 90s over portions of Texas and the Southwest. The West will be the coolest region with highs of 60s due to the arrival of showers off the Pacific, which is slightly below normal. Overall, an active Spring pattern continues, but warmer Eat of the Rockies with mainly 70s to 80s Demand the next 7 days will be LOW.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

WEEKLY

Natural Gas Weekly Update
Release Schedule: Thursday between 2:00 and 2:30 p.m. (Eastern Time)

Weekly Natural Gas Storage Report
Release Schedule: Thursday at 10:30 (Eastern Time) (schedule)