Despite scorching temperatures in store for the first week of July, a cooler long-term outlook squashed any hopes for a rally for natural gas bidweek prices, which posted steep 20- to 30-cent losses at the majority of market hubs. Hefty gains out West were no match for the overall weakness seen across the rest of the country, with the NGI July bidweek National Avg. tumbling 12.5 cents to $1.980.
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A slow start to summer heat, compounded by plump injections throughout the shoulder season, kept a lid on June natural gas bidweek prices. Less-than-inspiring forecasts accompanied a mix of mostly small month/month adjustments throughout the Gulf Coast, Midwest and East; the NGI June Bidweek National Avg. crept 4.0 cents higher to $2.105/MMBtu.
After natural gas futures prices in April plunged to their lowest level since 2016, and with a bearish weather outlook that is seen tightening storage deficits over the coming weeks, May bidweek prices fell in dramatic fashion.
Mild Temps, Supply Growth Seen Shrinking Storage Deficits as April NatGas Bidweek Traders Lock In Discounts
With a repeat of the chilly April 2018 temperatures that extended the natural gas storage withdrawal season last year seemingly not in the cards, and with production growth threatening to quickly erase inventory deficits, April bidweek traders locked in natural gas discounts throughout the Lower 48.
Forecasts for record-level cold to start the month gave March natural gas bidweek traders something to ponder even as the inevitable warm-up — set against a generally bearish supply backdrop — weighed on market sentiment with the shoulder season fast approaching.
After a decidedly mild December and a tepid start to 2019, natural gas price bulls were hoping the return of polar vortex cold in the back half of January would help drive strong gains during February bidweek.
A glance at January bidweek natural gas prices failed to reflect a market entering the peak of winter; dramatic losses of more than $1 were common as early-season cold made way for a far milder December, with long-range outlooks not yet conclusive as to when frigid conditions would return. The NGI Bidweek National Avg. tumbled 82.5 cents to $4.315/MMBtu.
It was a month of extremes for natural gas markets in November, featuring surging futures and negative spot trades in West Texas as early heating season cold brought volatility back with a vengeance; the NGI Bidweek National Avg. rocketed $1.955 higher to $5.14/MMBtu.
Widening storage deficits just weeks ahead of colder weather and cuts to Canadian imports have muddled the supply picture for the winter despite record production.
Meager natural gas storage inventories ahead of the 2018/19 winter helped futures bulls gain the momentum entering October bidweek, while physical prices in Appalachia and West Texas showed producers potentially feeling the shoulder season squeeze; the NGI National Bidweek Average climbed 3.5 cents from September bidweek to $2.675/MMBtu, which represents a 13.5-cent premium over October 2017 bidweek.