Natural Gas Demand & the Weather

[dan_s]

Watch the weekend update at this website: http://www.weatherbell.com/premium/

The warm weather that is hanging on in the eastern half of the U.S. is bullish for natural gas demand. Why? Because higher temperatures in the major cities means more demand from gas fired power plants. In the summer you want to watch the South and Northeast where there are a lot of gas fired "peaking plants". When they are fired up to generate electricity for air conditioning demand, they suck a lot of gas.

In the winter, you want to watch temps in Chicago and the big cities around the Great Lakes. The states that burn the most gas for space heating are Illinois, Michigan, Ohio, Wisconsin, Minnisota and Texas. When big cold waves dive deep into the South it is also bullish because everyone in the South heats with gas.