Natural Gas Fundamental Forecast – August 24, 2016

Natural Gas dipped 16 points to trade at 2.663 as we move into the in between season. Summer days are counting down and weather reports have been mixed. The East coast is looking a hot Labor holiday season while the mid-west and west are looking at cooler temperatures. On Monday Natural gas futures posted the biggest one-day gain in almost three weeks on speculation that a final spurt of hot weather before the end of summer will curtail fuel stockpiles, helping to erode a supply surplus that’s weighed on prices.

Above-normal temperatures are projected for most of the continental U.S. from Sept. 1 through Sept. 5, according to MDA Weather Services. The high in Washington Sept. 1 may be 87 degrees Fahrenheit (31 Celsius), 3 more than normal, according to AccuWeather Inc.

A surplus to the five year-average has narrowed for 19 straight weeks, according to the U.S. Energy Information Administration. Stockpiles totaled 3.34 trillion as of Aug. 12, 14 percent above the average.

Natural Gas Weekly Weather Outlook (www.natgasweather.com)

Aug 19 – Aug 25: It remains warm over the East Coast where highs into the upper 80s and lower 90s again expected into major cities, while also warming across the Great Lakes the next few days as high pressure briefly builds in. It’s hot over the West with upper 80s to 100s, apart from the coast. Most importantly, an early season cool blast with showers and thunderstorms is currently advancing into the northern Rockies and Plains, dropping temperatures into the 60s and 70s behind the cool front, which is several degrees below normal. Next week will remain slightly cool over the central US, but very warm to hot over the West and East Coasts, especially late in the week. Overall, nat gas demand will be MODERATE the next 7-days.

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