Natural Gas Price Prediction – Prices Whipsaw on Flat LNG Deliveries

Natural gas prices continued to whipsaw on Monday despite a holiday in the US that generated low liquidity. Demand moved lower in the most recent week, and supply was flat. LNG exports were unchanged week over week. The weather is expected to become more mild in the 8-14 day forecast, which should weigh on natural gas demand.

Technical Analysis

Natural gas prices whipsawed lower closing below he most recent breakdown level during the long holiday weekend. Short term momentum has turned positive as the fast stochastic generated a crossover buy signal. The fast stochastic has rebounded after being in oversold territory which points to accelerating positive momentum. Medium term momentum is neutral. The MACD (moving average convergence divergence) histogram is printing in the black with a flat trajectory which points to consolidation.

LNG Exports were Flat

The EIA reported this past week that LNG exports flat week over week. Eleven LNG vessels with a combined LNG-carrying capacity of 38.2 Bcf departed the United States from May 16 to May 22, according to shipping data. Three vessels,  one at each of the terminals, were loading on Wednesday.

Sempra Energy, the majority owner of the Cameron liquefied natural gas (LNG) export facility, announced that the company has started to liquefy natural gas from the first of three liquefaction units, referred to as trains, coming online in Phase 1 of the project. Sempra Energy anticipates shipping LNG cargoes from Train 1 in the next few weeks, bringing total U.S. baseload operational LNG export capacity to about 4.8 billion cubic feet per day.

Net injections into storage totaled 100 Bcf for the week ending May 17, compared with the five-year (2014–18) average net injections of 88 Bcf and last year’s net injections of 93 Bcf during the same week. Working gas stocks totaled 1,753 Bcf, which is 274 Bcf lower than the five-year average and 137 Bcf more than last year at this time.