Natural Gas Price Fundamental Daily Forecast – Supported by Hopes of Fifth Straight Bullish EIA Storage Report

Natural gas futures are trading nearly flat shortly after the regular session opening on Wednesday after the latest weather reports put a slightly cooler spin on temperatures.

Futures closed higher on Tuesday, bringing an end to the six-day losing streak. Prices are also being supported by low production numbers and the hopes for another bullish storage report.

At 14:30 GMT, December natural gas is trading $2.956, up $0.007 or +0.24%.

Bespoke Weather Outlook

Bespoke Weather Services data indicated a second consecutive day of increased demand, with a few days toward the front half of the 15-day outlook moving closer to normal in terms of temperatures, Natural Gas Intelligence (NGI) reported.

This is the result of “a couple of upper level troughs swinging through the eastern third of the nation,” Bespoke said. “As it stands right now, we do not have a single day in the forecast that is colder than normal, however.”

With the combination of a positive Eastern Pacific Oscillation and positive North Atlantic Oscillation “continuing to look quite strong in the medium range guidance, it still seems likely that warmth will continue to the end of the month and probably start December as well,” the firm said.

NatGasWeather Outlook

According to NatGasWeather for November 10-17, “Warmer than normal conditions continue across the southern and eastern U.S. with highs of 60s to 80s. Weather systems with rain and snow will continue across the West & Northern Plains with chilly highs of 20s to 50s for locally stronger demand. Cooler air will eject out of the Plains and across the Great Lakes and Northeast Friday –Saturday and again next Monday – Tuesday with lows of 10s to 30s for modest bumps in national demand. Overall, national demand will be low today, then increasing to moderate Friday – Tuesday.”

“Tropical Storm Eta is expected to finally make a move the next few days, tracking into West Florida Thursday – Friday. Impacts are expected to be minor with slight declines in Gulf of Mexico production but with localized power outages across Florida.”

Daily Forecast

If support at $2.929 holds today then the market may finish higher for the session ahead of Thursday’s U.S. Energy Information Administration (EIA) weekly storage report. Bulls are hoping for a fifth straight bullish storage report with NGI’s model predicting a 5 Bcf injection for the week-ending November 6.

Meanwhile, “Natural gas production remains near the low for the year,” and both the Cameron and Freeport liquefied natural gas terminals “continue to ramp up feed gas flows, offset by a small decline at Sabine Pass,” the EBW analysts said.

Production is low and LNG demand is steady, but prices will have a difficult time rallying without colder weather.