Natural Gas Market

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Natural gas prices are determined by regional supply/demand.

The eastern half of the U.S. is expecting cooler than normal weather for the first half of June. That will reduce ngas demand for power generation.

The last three weekly natural gas storage reports have been very bullish as the difference to the 5-year average has been reduced by 69 Bcf over that 21 day period. In fact, over the last ten weeks, the difference to the 5-year average has declined by 177 Bcf, thanks in large part to the 150 Bcf draw reported the week ending March 17th.

The next three weekly reports are important since we are right in the middle of the shoulder season when injections are at the peak. Storage reports showing injections under 100 Bcf s/b considered bullish.

Demand for gas really picks up in July and this year will include a big increase in exports.