Natural Gas Price Fundamental Daily Forecast – Showing Slightly Positive Reaction to Inline EIA Storage Report

Natural gas futures are edging higher for a third straight session on Friday after the government’s weekly storage report, released on Thursday, came out in line with expectations. Meanwhile, the longer-term forecasts are still coming in warmer, but some weather services are eyeing cooler trends for April-20.

At 12:10 GMT, May natural gas futures are trading $2.525, up 0.003 or +0.12%.

According to Natural Gas Intelligence (NGI), working in favor of bears is a generally mild outlook for April. The latest weather models have trended warmer for the next five days, but then show a cold front moving into the central United States by the middle of next week. The chilly air is first expected to drop into the Midwest, then push to the South and East in the days after.

Energy Information Administration Weekly Storage Report

The EIA reported on Thursday that domestic supplies of natural gas rose by 20 billion cubic feet for the week-ended April 2. That compares with an average increase of 27 billion cubic feet forecast by analysts polled by S&P Global Platts.

Ahead of the report, NGI wrote, a Bloomberg survey of 10 analysts pegged this week’s injection between 16 Bcf and 28 Bcf, with a median build of 22 Bcf. A Reuters poll produced estimates ranging from injections of 10 Bcf to 26 Bcf, with a median increase of 21 Bcf. NGI’s model forecast the injection of 23 Bcf.

Total stocks now stand at 1.784 trillion cubic feet, down 235 billion cubic feet from a year ago and 24 billion cubic feet below the five-year average, the government said.

Short-Term Weather Forecast

According to NatGasWeather for April 9-14, “A very light demand pattern continues as strong high pressure rules much of the U.S. with highs of 50s to 70s across the northern U.S. and 70s and 80s across the southern U.S. Slightly cooler exceptions will occur across the Great Lakes as weather systems bring showers, thunderstorms, and highs of 50s and 60s.

Additional mild weather systems will track across the western and central U.S. this weekend into early next week with highs of 50s to 70s, while warm elsewhere with highs of 60s to 80s besides hotter 90s in the Southwest deserts.

Overall, very light demand into early next week, then moderate-high by mid-next week.

Daily Forecast

The $2.450 to $2.350 area appears to be a strong area of support and any dips into this zone could get bought up quickly. Any additional improvement in supply/demand balances would make it less necessary for prices to continue pushing lower.