Natural Gas Weekly Price Forecast – Natural Gas Markets Reach Towards $5.00

Natural gas markets have gotten ahead of themselves, as we have reached the $5.00 level during the course of the week. Ultimately, I think this is a market that will continue to see a lot of interest, as Russia continues to cut off supply and play games with the European Union, right at the same time that the hurricane in Louisiana cut down a lot of the refinery capacity. Beyond that, we had already been in a significant heat wave in North America, so it all kind of came together for a bit of a “perfect storm.”

NATGAS Video 13.09.21

That being said, I do think that we probably have further to go based upon the reopening trade, but I would also make the argument that a little bit of a pullback is probably necessary at this point. After all, this is a market that has gotten way ahead of itself, so I do think that eventually we will have to see a bit of value offered for people to get heavily involved. With this, I believe that the market probably sees the $4.50 level as a significant support level, and I am almost positive that the $4.00 level will cause a lot of attention as well.

In fact, it is not until we break down below the $4.00 level that I would be concerned about the overall uptrend, because quite frankly I think what we are seeing here is a market that has a lot of fundamental tailwinds, and not just from itself, but from the commodity markets in general as the reopening trade causes so much flooding into inflationary sectors such as energy. All things been equal, I do not have a scenario in which a willing to sell as long as we are above $4.00.

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