Natural gas futures continued to stumble through midday trading Thursday as the market reaffirmed its initial bearish response to the latest government inventory report. Meanwhile, spot prices were down sharply despite unseasonably cool spring temperatures forecast for the Midwest and East through the weekend.
Here’s the latest:
- May Nymex contract down 5.8 cents to $1.783/MMBtu as of 1:52 p.m. ET
- Storage drawdown slightly lighter versus median of pre-report estimates
A sell-off was triggered after the U.S. Energy Information Administration (EIA) reported a 37 Bcf withdrawal from Lower 48 storage for the week ending March 29. While near the midpoint of pre-report expectations, the magnitude of the withdrawal may have disappointed market bulls hoping to see a stronger drawdown amid lighter production and chilly late-season temperatures. The latest EIA print did make a dent in the surplus versus the five-year average, trimming it to 633 Bcf, versus 669 Bcf in the week-earlier period.
- LNG export volumes recovering to near 13.0 Bcf/d in recent daily estimates, Wood Mackenzie data show
- Flows to Sabine Pass, Corpus Christi have rebounded after dipping earlier in the week, according to NGI’s LNG Export Tracker
The recovery in liquefied natural gas feed gas volumes suggests the recent drop “was just a temporary phenomenon,” analysts at Gelber & Associates said Thursday.
- Mild weather lining up for later this month
Maxar’s Weather Desk in its updated 11- to 15-day projections Thursday called for “widespread coverage of above normal temperatures” across the Lower 48. The latest outlook for this time frame trended somewhat warmer for the East, as well as from the Interior West to north-central portions of the country, the forecaster said.
- Cash prices crumble despite cool near-term forecast, NGI’s MidDay Price Alert shows
- Henry Hub off 14.0 cents to $1.720, giving back most of prior day’s gains
- Chilly temperatures forecast for Midwest and East Coast population centers through the weekend, per Maxar
The forecaster called for low temperatures in the low to mid-30s through Sunday for Chicago. Below normal temperatures should also blanket the Interstate 95 corridor over the next few days, including unseasonable low temperatures in the upper 30s to low 40s for Washington, DC, and Atlanta, according to Maxar.
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