

Nat gas prices fell for a 3rd consecutive day yesterday. Losses were driven by increased production, lower LNG feedgas and expectations for cooler temps in the Central US, which are reducing power burn expectations. Aug futures settled 4.3 cents lower at $2.435. Over the past week, spot month prices have declined by 40 cents, or about 15%.

Today’s storage report covering the week ended June 28 is expected to show stocks rose 32 BCF. This compares to last year’s build of 76 BCF and the 5 yr avg build of 69 BCF. If correct, stocks will total 3.129 TCF. The report will be released today at 11am CT.
Despite the string of below normal injections, concerns are starting to emerge over the possibility of elevated season ending storage levels which has been weighing on the summer strip. Reuters says storage is on track to end injection season at a 4 year high of 3.913 TCF. This compares to last year’s 3.809 TCF and the 5 yr avg of 3.747 TCF.
An uptick in production since mid June has weighed on the market. Output has trended back over 100 BCF/day, coming in near 15 week highs at 101.9 BCF/day yesterday.
Hurricane Bery weakened yesterday and will impact Jamaica today, reaching the Yucatan Peninsula on Friday. Beyrl is likely to weaken to a tropical storm as it emerges in the western Gulf this weekend. Nat gas production in the Gulf has declined the past few years with output in that region only about 2.1 BCF/day, accounting for just 5% tot total US dry output.

Gas fired power demand is expected to trend higher than the 3 yr avg through mid July but will likely fall short of levels seen during late June that reached as high as 46 BCF/day . Platts estimates power burn will average around 44.3 BCF/day over the next 2 weeks.
A slowdown in LNG feedgas since the end of June is being attributed to lower flows at Sabine Pass. LNG Feedgas demand fell to 12 BCF/day for the first 2 days of July and is estimated this morning at 12.2 BCF/day.
Prices are trading steady to higher this morning in anticipation of today's storage data and hotter temps next week.

The July 24 natural gas contract lost .042 in Tuesday’s session settling at 2.435 while also closing under 200 day moving average support on the daily continuation chart.
The 2.400-2.415 are is primary support today. If broken, the 50% retracement of the 2024 uptrend at 2.320 will become the next area of support.
Trend following oscillators on the 60-minute chart have turned bullish with bullish divergences also forming which may suggest higher trade today.
The 200 day moving average at 2.465 is near term resistance followed by the 10 and 40 day moving averages which have converged at 2.630-2.640.
However, daily chart trend following indicators remain bearish suggesting the overall trend may be turning down. 10 and 40 day moving average alignment is also turning bearish.
Moving Average Alignment – Neutral-Bearish
Long Term Trend Following Index – Bearish
Short Term Trend Follow Following Index - Bearish
Relative Strength Index - 41.33






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