Natural Gas Price Fundamental Daily Forecast – Traders More Focused on Heating Demand than EIA Report

Natural gas futures are edging lower shortly before the government’s weekly storage report. Traders are not expecting to see a bullish report, but expectations of increased heating demand may be helping to underpin prices. Technically, traders are finding resistance at a long-term retracement area identified as $2.622 to $2.706.

At 13:49 GMT, May natural gas futures are trading $2.598, down $0.020 or -0.76%.

Short-Term Weather Outlook

According to NatGasWeather for April 15 -21, “Several colder than normal weather systems will track across the U.S. over the next week, with rain, snow, and chilly lows of 20s to 40s for strong national demand, coldest over the Rockies, Midwest, and interior Northeast. The southern U.S. will also see bouts of showers, although still mostly comfortable with highs of 60s to 80s. The West Coast will be the warmest and driest region as strong high pressure brings highs of 60s to 80s. Overall, demand increasing to moderate and high the next 7-days.”

US Energy Information Administration Weekly Storage Report

This week’s EIA storage report is expected to show a build in the mid-60s Bcf, according to consensus analysis.

Natural Gas Intelligence (NGI) is reporting that a Bloomberg survey found injection estimates ranged from 62 Bcf to 79 Bcf, with a median of 66 Bcf. The median of a Reuters poll landed at a build of 66 Bcf; injection estimates spanned 50 Bcf to 79 Bcf. NGI forecasted an injection of 67 Bcf for the period, which covers the week ended April 9.

An injection in line with consensus predictions would roughly match the 68 Bcf build EIA recorded in the year-ago period but would be bearish versus the five-year average injection of 26 Bcf.

Daily Forecast

NatGasWeather said ahead of the EIA report, “National survey averages favor a build of 64-68 Bcf, but with the most notable at 68 Bcf.

It was warmer than normal over most of the U.S. besides the Southeast, especially so across the Midwest. Our algorithm suggests a build of 69 Bcf to the conservative side and 72-73 Bcf if production was a little stronger than expected. Either way, we expect a bearish outcome versus survey averages.”

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