Natural Gas price likely to be over $3.50 on May 29
Posted: Tue May 27, 2025 1:17 pm
Here's why.
> JUN25 is the front month NYMEX contract for HH NGas you are seeing today. It was $3.37 at the time of this post.
> On Thursday, May 29 JUL25 will become the front month contract, and it will the price you see in the news. At the time of this post, it was trading at $3.71.
The Paper Traders that are closing their short positions in JUN25 today and tomorrow may roll their shorts forward into the JUL25 or AUG25 contracts, but IMO that will be a very risky bet for them since Q3 is when we are most likely to see a Bidding War in the futures contact like we saw in August 2022.
At the bottom of page three of my newsletter you can see that on Thursday, May 29th EIA is expected to report a natural gas storage build that is lower than the 5-year average. The media might use that as the reason for the natural gas price spike I'm expecting to see on Thursday, but it is really just the fact that JUL25 will be the front month contract. July and August are the hottest months of the year when electricity demand spikes causing natural gas fired power plants to ramp up to maximum capacity.
Utilities and LNG exporters worried about having enough supply will bid up the futures contracts with the goal of taking delivery of the gas.
I expect the AUG25 futures contact to be over $4.00 by the end of June when it becomes the front month and the JAN26 futures contract to be over $5.00 by the end of November when it becomes the front month.
If this all comes to pass, our Gassers (AR, CTRA, EQT and RRC) will draw a lot of attention.
> JUN25 is the front month NYMEX contract for HH NGas you are seeing today. It was $3.37 at the time of this post.
> On Thursday, May 29 JUL25 will become the front month contract, and it will the price you see in the news. At the time of this post, it was trading at $3.71.
The Paper Traders that are closing their short positions in JUN25 today and tomorrow may roll their shorts forward into the JUL25 or AUG25 contracts, but IMO that will be a very risky bet for them since Q3 is when we are most likely to see a Bidding War in the futures contact like we saw in August 2022.
At the bottom of page three of my newsletter you can see that on Thursday, May 29th EIA is expected to report a natural gas storage build that is lower than the 5-year average. The media might use that as the reason for the natural gas price spike I'm expecting to see on Thursday, but it is really just the fact that JUL25 will be the front month contract. July and August are the hottest months of the year when electricity demand spikes causing natural gas fired power plants to ramp up to maximum capacity.
Utilities and LNG exporters worried about having enough supply will bid up the futures contracts with the goal of taking delivery of the gas.
I expect the AUG25 futures contact to be over $4.00 by the end of June when it becomes the front month and the JAN26 futures contract to be over $5.00 by the end of November when it becomes the front month.
If this all comes to pass, our Gassers (AR, CTRA, EQT and RRC) will draw a lot of attention.