Natural Gas Weekly Fundamental Analysis, August 17 – August 21, 2015 Forecast

James Hyerczyk
Weekly October Natural Gas

Weekly Analysis and Recommendation: 

October Natural Gas futures attempted to breakout to the upside last week, but bearish fundamental news once again thwarted the effort. The market did close a little better for the week, but momentum may be shifting back to the downside since it closed on the weak side of the mid-point of its three month range.

Last week’s rally was brought to an end after the U.S. Energy Information Administration (EIA) reported that U.S. natural gas stocks increased by 65 billion cubic feet (Bcf) for the week-ending August 4. Analysts were looking for a storage injection of 55 billion cubic feet. The five-year average for the week is an increase of around 48 billion cubic feet, and last year’s addition for the week totaled 79 billion cubic feet.

This week’s data probably kept a lid on prices since stockpiles came in at about 21% above their levels of a year ago and about 3% above the five-year average. Naturally, if you look at the chart, you will see that the current price at $2.844 is substantially lower than last year’s $3.830 close the week-ending August 15, 2014.

Additionally, the EIA reported that U.S. working stocks of natural gas totaled about 2.977 trillion cubic feet, close to 81 billion cubic feet above the five-year average of 2.896 trillion cubic feet and 521 billion cubic feet above last year’s total for the same period. Working gas in storage totaled 2.456 trillion cubic feet for the same period a year ago.

Besides the weekly forecast, the EIA also issued a report highlighting its short-term projections. This report was also bearish because in it, the EIA is projecting that natural gas inventories will reach its second-highest level on record by October 31.

Gas inventories are projected to reach 3.867 Trillion cubic feet (Tcf) by the end of the summer refill season. This estimate puts end-of-season inventories at 69 Bcf above the five-year average.

The EIA also estimates monthly average spot prices to remain lower than $3/MMBtu through October, and lower than $4/MMBtu through the end of 2016.  

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 recent analysis and information in our weekly reports and we provide daily updates and outlooks. 

Weekly October Natural Gas

 AccuWeather US Forecast Outlook: 

This week-end should bring above average temperatures to the Great Lakes region. The typical pattern across the United States for the middle of August features widespread heat and humidity. The Bermuda High is usually anchored off the East Coast, spreading lots of heat and humidity into the eastern U.S. The jet stream is usually positioned well to the north and is weak. 

From August 15 to August 24, high temperatures in Chicago are expected to range from 83 to 92 degrees. Low temperatures are expected to range from 67 to 73 degrees. 

During the same time period, high temperatures in New York are expected to range from 85 to 93 degrees. Low temperatures are expected to range from 71 to 75 degrees. 

Economic Events: 



Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.