Natural Gas Fundamental Analysis – November 5, 2015 – Forecast

Analysis and Recommendations:

Natural Gas  gained 36 points to 2.289 as traders bought up the cheap commodity after sending it to new bottom this week. Natural gas prices recovered from three-year lows due to the colder weather expected across the US over the next two weeks. Bearish traders also squared off their short position. This led to the rise in natural gas prices. Commodity Weather Group suggests that colder-than-normal winter weather in the following weeks could drive the demand for natural gas and draw down the natural gas inventory.

Last week, the EIA (U.S. Energy Information Administration) published the natural gas stocks report. It highlighted that natural gas stocks rose by 63 Bcf (billion cubic feet) for the week ending October 23, 2015.

Natural-gas prices have slumped in recent sessions as weather forecasts called for above-normal temperatures to extend into mid-November, which is expected to reduce demand for natural gas as an indoor-heating fuel. Some traders’ worry that low consumption could push inventories of natural gas to record highs in the coming weeks.

Natural Gas Weekly Weather Outlook

October 29th – November 4th: A mild and moist weather system tracking across the Mid-Atlantic and NE will exit today. However, a colder system out of southern Canada will sweep through the northern Plains and Midwest today, and across the NE Friday while weakening. This will bring another round of showers, with a rain/snow mix into the coldest air over the Great Lakes. Overnight lows behind the cold front will drop into the upper teens to 30s with highs of only 40s and 50s. There will also be weather systems tracking across the West the next few days with showers and cooling, with a track then through the mid-central US this weekend. This will be followed by a colder and stronger Western US system next week, while the central and eastern US becomes warmer than normal. Overall, demand will be MODERATE, then dropping back LOW by 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)