Natural gas markets traded on either side of even through midday Friday as traders weighed vying potential bullish and bearish catalysts.
Here’s the latest:
- August Nymex natural gas futures up 1.0 cent to $2.135/MMBtu as of 2:25 p.m. ET
The August contract in the morning walked back some of the gains sparked by a bullish EIA storage print on Thursday. EBW Analytics Group senior analyst Eli Rubin observed that much of the bullish miss was “likely the result of market noise rather than an underlying signal.”
Storage surpluses remained well above the five-year norm, Rubin observed. He cited “multiple bearish catalysts ahead” including near-term milder weather, the anticipated startup of the Matterhorn pipeline in the Permian Basin, and the heart of the hurricane season still ahead for the Gulf Coast.
- Recent seven-day average for Lower 48 production of 101.8 Bcf/d up 0.1 Bcf/d week/week, according to Wood Mackenzie
Even with gas production in an upward trend, on a weather-adjusted basis the market was still undersupplied during the latest week covered by the latest government storage report, according to Tudor, Pickering, Holt & Co. (TPH) analyst Justin Martin.
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However, fundamentals were expected to loosen during the next EIA period as power demand dropped off, Martin said. In addition, July cooling degree days were pacing above the 10-year average, but cooler forecasts for August could pull demand back in-line with the average, he said.
- Freeport LNG Development LP terminal receiving around 763 MMcf of gas Friday, according to NGI data
The liquefied natural gas terminal in Texas said it would restart one train this week before it brought on the other two trains. An LNG vessel was due to arrive at the terminal on Saturday, Kpler data show.
NGI data also showed Corpus Christi LNG taking a reduced rate of feed gas for a fourth day, at around 1.6 Bcf/d Friday. However, it was not fully clear what the slowdown meant given that WhiteWater Midstream LLC’s Agua Dulce-Corpus Christi (ADCC) intrastate pipeline that started up last week was not required to report daily flows.
The lower flows to Corpus Christi “could either mean that gas is being pulled in via ADCC instead” or the terminal had a train down this week, according to Criterion Research Inc.’s James Bevan, vice president of Research.
- Next-day natural gas cash prices mostly slide, according to NGI’s MidDay Price Alert
- Henry Hub averaging $1.885, down 11.5 cents; Waha averaging negative 13.0 cents, down 59.0 cents
National gas demand was expected to be light over the next five days, NatGasWeather said.
Weather models overnight tacked on a modest amount of heat in updates, including to the period starting Tuesday when a high pressure system was expected to build across the country to boost demand, the firm said.
