uploads///cold weather

Weather Could Help Natural Gas Bulls Next Week


Nov. 17 2017, Published 9:44 a.m. ET

Natural gas prices  

December US natural gas (UGAZ) (GASL) futures contracts rose 0.3% to $3.06 per MMBtu (million British thermal units) in electronic exchange at 12:55 AM EST on November 17, 2017. On the other hand, E-Mini S&P 500 (SPY) futures contracts for December delivery fell 0.11% to 2,582.25 in electronic exchange.

Meanwhile, US natural gas futures are near a six-month high. However, prices have fallen 17% year-to-date. Volatility in gas prices impacts oil and gas producers (XOP) (IXC) like WPX Energy (WPX), Chevron (CVX), Southwestern Energy (SWN), and Gulfport Energy (GPOR).

Article continues below advertisement

Weather forecasts  

The latest forecasting models suggest that the weather is expected to be mild this week, which could lead to moderate natural gas demand. The weather is expected to be mild in the central and southern states and most of the western US.

However, the weather is expected to be colder than normal next week. There could be cold temperatures across Northeastern, Great Lakes, and Mid-Atlantic parts of the US next week. Overall, the weather will be chilly by the end of next week. Nearly half of US domestic households use natural gas for heating and cooling. Any change in the weather will drive the demand. High demand could have a bullish impact on natural gas (DGAZ) (UGAZ) prices. 

NOAA estimates that the temperatures this winter (2017–2018) will be 13% colder than last winter (2016–2017) across the US. On the other hand, the US National Weather Service estimates that the temperatures will be warmer than average this winter.

In the next part, we’ll discuss US natural gas inventories.


More From Market Realist

    • CONNECT with Market Realist
    • Link to Facebook
    • Link to Twitter
    • Link to Instagram
    • Link to Email Subscribe
    Market Realist Logo
    Do Not Sell My Personal Information

    © Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.