Natural Gas Fundamental Analysis, May 6, 2015 – Forecast
Analysis and Recommendations:
Natural Gas is off by 22 points at 2.799 giving back most of last week’s rally after inventory reports showed a small gain than expected. Natural gas had soared above the 2.90 price at the end of the week, but warm spring weather is weighing heavily on prices. Lower natural gas prices are driving the demand for natural gas as an alternative to coal. Similarly, above normal warm weather will drive the cooling needs and will increase the demand for natural gas from power stations. Weather forecasting agencies expect warmer weather across the mid-Atlantic and Northeast parts of the US until May 10. The temperatures in Washington are expected to be 15% above normal temperatures, according to Accuweather sources.
Last week, the EIA (U.S. Energy Information Administration) published the natural gas in storage report on April 30, 2015. Gas in storage rose by 81 Bcf (billion cubic feet) against the market estimates of 86 Bcf. Lower-than-expected gas withdrawals also supported the gas prices last week.
AccuWeather US Forecast Outlook:
This summer, warmth and dryness will build in the West, worsening the historical drought conditions that have plagued California for four straight years. Meanwhile, the Gulf Coast will have an abundance of moisture, raising concerns for flooding at times.
In the nation’s midsection, severe weather is forecast to continue into summer, with the overall tornado count increasing from last year. In the Northeast, above-normal temperatures will mark a noticeable difference from the cooler-than-average summer of 2014.
ForexTraq provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.
Natural Gas Weekly Update
Release Schedule: Thursday between 2:00 and 2:30 p.m. (Eastern Time)
Weekly Natural Gas Storage Report
Release Schedule: Thursday at 10:30 (Eastern Time) (schedule)