Natural Gas Traders Bracing for Triple-Digit Draw

On November 22, 2018, in natural gas futures news, by Infinity Trading
natural gas futures news

natural gas futures news

November 21, 2018,

Natural gas futures are on the rise early Thursday, well ahead of today’s U.S. Energy Information Administration report. Today’s report is one day early because of tomorrow’s U.S. Thanksgiving holiday. It’s also scheduled for a different time at 1700 GMT.

At 0810 GMT, January Natural Gas futures are trading $4.765, up $0.239 or +5.31%. The high of the session is $4.875. This is slightly below last week’s spike high at $4.964.

Pre-report estimates are calling for a triple-digit withdrawal for the week-ended November 16. The range guesses are minus 92 Bcf to minus 121 Bcf. Last year, the EIA reported a 42 Bcf withdrawal for the same period. The five-year average for this time of year is a withdrawal of 25 Bcf. So if you do the math, today’s withdrawal is expected to come in at nearly 4 times the five-year average. That’s very bullish if you’re keeping score at home.
Why is this important?

A triple-digit withdrawal will be major news since it’s still only November and the winter heating season is just getting started. Furthermore, it will significantly widen the year-on-year and five-year storage deficits. This could pose problems later in the winter season if the cold blasts continue.

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