

Nat gas prices surged higher yesterday as colder weather forecasts led to a round of short covering while the season’s first storage withdrawal pushed prices even higher during afternoon trade. The spot month gas contract ended Thursday’s session up 14.6 cents at $3.339, bringing the 2 day gain to more than 35 cents.

Anticipation of much colder temperatures for late November has been the primary driver of the recent rally as heating demand is projected to increase over the next 2 weeks.
Res/comm usage is projected to surpass 40 BCF/day by late next week before topping out near 45 BCF/day during the first week of November. This compares to the 7 day average of 26.3 BCF/day.
The EIA report revealed an unexpected storage withdrawal of 3 BCF for the week ended Nov 15, defying expectations for a small build. Despite this draw, the 5 yr avg surplus rose for a 5th straight week while the year over year surplus narrowed. Total gas in storage stands at 3.969 TCF with the 5 yr avg surplus now at 239 BCF and the year over year surplus at 141 BCF.
For the week in progress, a build of 2 to 4 BCF is possible which would once again widen the 5 yr avg surplus.

Nat gas prices have halted their 5 day rally this morning with prices trading 18 cents lower. Production is heading back higher with the surplus still in place.

Natural gas prices spiked higher for a 2nd day on Thursday on a combination of short-covering, end-user buying, and technical buying with the breakout above 3.000 resistance on Wednesday.
The December contract was up .146 (4.6%) on Thursday gaining .341 (11.4%) over the past two sessions to close Thursday at 3.339.
The December contract is currently down .150 or 4.5% trading near 3.185 after topping out at a 3.563 overnight high. The overnight high came within .067 of 3.630 high set in November 2023. The November 2023 3.630 high marked the high point for winter 2023-2024.
Former June 2024 resistance at 3.159 broken on Wednesday is now near term support followed by 3.000-3.020.
Moving Average Alignment – Bullish
Long Term Trend Following Index – Bullish
Short Term Trend Follow Following Index - Bullish
Relative Strength Index - 62.72






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