Natural Gas Fundamental Analysis – August 4, 2015 – Forecast

Analysis and Recommendations:

Natural Gas  added 46 points as hotter temperatures blanketed the US increasing residential demand and electric production. NG is trading at 2.763. At under $3 per mmbtu, the downside is limited and the upside explosive. Since 1990, this commodity has spent the majority of the time above the $3 level. The bears have had a good time of it for months now. The market rewarded sales with lower prices and profits. They will continue to sell rallies convinced that newly discovered reserves will cap any price rallies.

Demand for natural gas tends to rise in the summer months as warmer temperatures increase the need for gas-fired electricity to power air conditioning. Natural gas accounts for about a quarter of U.S. electricity generation.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended July 24 rose by 52 billion cubic feet, below expectations for an increase of 54 billion and following a build of 61 billion cubic feet in the preceding week.

Supplies rose by 88 billion cubic feet in the same week last year, while the five-year average change is an increase of 48 billion cubic feet.

Total U.S. natural gas storage stood at 2.880 trillion cubic feet as of last week. Stocks were 586 billion cubic feet higher than last year at this time and 85 billion cubic feet above the five-year average of 2.795 trillion cubic feet for this time of year.

AccuWeather US Forecast Outlook:

Natural Gas Weather.com forecast a hot dome of high pressure will dominate much of the country into early next week with widespread 90s to 100s, including all of Texas. The exception will be over the far northern US, notably the upper Great Lakes and interior NE. It will be most uncomfortable from eastern Texas and the South where high humidities will result in uncomfortable conditions and strong demand for cooling as the Heat Index exceeds 104F. The West will also remain quite hot with 90s to 100s right up to major coastal cities until cooling arrives early next week. Overall, national cooling demand will be HIGH

FxEmpire provides in-depth analysis for each currency and commodity 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.

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)