Natural Gas Fundamental Analysis – November 11, 2015 – Forecast

Analysis and Recommendations:

Natural Gas added 12 points to trade at 2.312 as traders bought up the cheap commodity. Temperatures will be above normal from the Midwest through the Northeast over the next 15 days, according to MDA Weather Services. The warmth will also spread across the Southeast on Nov. 19 through Nov. 23. U.S. gas inventories rose to 3.929 trillion cubic feet on Oct. 30, matching an all-time high.

“It looks like we have two weeks of storage injections still and the forecasts aren’t showing strong heating demand,” said Gene McGillian, senior analyst at Tradition Energy in Stamford, Connecticut. “We still have a real glut of gas in the market.”

Natural gas for December delivery fell 7.1 cents, or 3 percent, to settle at $2.30 per million British thermal units on the New York Mercantile Exchange. Prices ended last week at $2.371, the highest since Oct. 22. Futures are down 20 percent this year.

December $2.80 calls were the most active options in electronic trading, slipping 1 cent to 0.7 cent on volume of 2,253 contracts.

Recent sessions have brought a small rebound as warm forecasts started to give way to colder ones, the first sign that a surge of heating demand could be on the way. But Monday’s updates aren’t showing that cold spreading, and still have the largest Eastern and Midwestern markets covered in unseasonably warm weather until nearly Thanksgiving.

Natural Gas Weekly Weather Outlook

November 6-12th: A weather system will track across the central US today with widespread showers, weakening the warm ridge of high pressure over the eastern US. The East Coast will see warmer dayswith highs into the lower 70s into major NE cities, with 80s over the Southeast. As the central US system tracks eastward, it will open the door for cooler Canadian air into the Midwest and Northeast this weekend. However, warming will follow into the East next week as another Pacific storm with valley rains and mountain snows hits the West. Temperatures will cool over the eastern US late next week as the western US weather system tracks across the country. Overall, national nat gas demand will be MODERATE Friday-Sunday, then back to LOW early next week.

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)