

The nat gas market rallied early yesterday as production continued to fall, the surplus narrowed and feedgas flows ticked higher, alleviating concern over the saturated market. The June contract settled higher for the 5th time in 6 sessions, gaining 11.4 cents to settle at $2.301.
Cal’25 nat gas prices declined yesterday to their lowest since Feb 2022 on rumors that construction on Exxon Mobil’s Golden Pass LNG export plant in Texas could start later than previously expected. Golden Pass was expected produce LNG during the first half of 2025.

Last week’s storage addition came in below expectations at 79 BCF. The build was 2 BCF higher than the 5 yr avg and 8 BCF above last year’s comparison. Total gas in storage as of May 3 now stands at 2.563 TCF, leaving stocks 640 BCF above the 5 yr avg and 444 BCF above last year.
A more supportive injection is expected for the week ending May 10 with estimates ranging from 68 BCF to 74 BCF. This compares to last year’s injection of 93 BCF and the 5 yr avg build of 90 BCF.
Gas flows into Freeport rose to a 16 week high of 1.7 BCF/day, up from the previous 7 day average of 1.3 BCF/day. While Freeport is on its way to becoming fully operational, maintenance at Cameron LNG is set to run through the end of May, keeping LNG flows below full capacity this month.
Feedgas demand is estimated this morning at 13.4 BCF/day, up 0.7 BCF/day from Thursday. Platts is forecasting feedgas flows to remain above 13 BCF/day over the next 2 weeks.

Production levels remain well below year ago comparisons as producers continue to pullback. According to Platts, output is running 3.2 BCF/day lower than last year, averaging 99.3 BCF/day so far this month. Output as of this morning is coming in at 99.7 BCF/day, 0.4 BCF/day above Thursday’s level.
With gas demand likely to hit seasonal lows this month, it could prove challenging for the market to maintain recent gains. The next 15 days are forecast to yield 53.2 CDDs which falls on the low side of normal.
The June contract is currently trading about 2 cents lower on the day.

A strong uptrend in the natural gas market on Thursday as the June 24 contract reversed back higher in early trade after holding above weekly low support.
By session’s close, the June contract rallied up to a 2.301 daily settle, up .114 (5.2%) for the day and a new 2024 closing high.
Volume was good at 207,677 contracts.
The top of the open gap on the daily continuation chart set in late-January at 2.400 is the next upside objective followed closely by the 200 day moving average at 2.455.
Weekly low support is at 2.130-2.140 which coincides with the 10 day moving average at 2.130 today.
Moving Average Alignment – Neutral-Bullish
Long Term Trend Following Index – Bullish
Short Term Trend Follow Following Index - Bullish
Relative Strength Index -68.08






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