Natural Gas, Short-Term Energy Outlook 06-19

Onyx Power and Gas Consulting continues with its weekly series providing the Short-Term Energy Outlook as of June 11, 2019.  This series of news articles should provide a complete insight on the current conditions of the energy…enjoy, check out archives and come back each week for additional information on how all sorts of energy sources impact our daily lives.

Natural Gas

Prices: The front-month natural gas futures contract for delivery at the Henry Hub settled at $2.32/million British thermal units (MMBtu) on June 6, a decrease of 30 cents/MMBtu from May 1 (Figure 9). EIA estimates that U.S. natural gas production reached another record high in May. This persistent production growth contributed to injections of more than 100 billion cubic feet (Bcf) for five of the past six weeks, bringing U.S. working gas in underground storage levels closer to the five-year (2014–18) average, 9% higher than year-ago levels. Combined net injections into storage during April and May, in 2019, are estimated to be the largest on record for that two-month period at 831 Bcf (Figure 10), which helped to reduce futures prices even though inventories remain lower than the five-year average.

Figure 9: U.S. natural gas front-month futures and storage
Figure 10: April and May combined net change in U.S. working gas inventory

Money manager positions: The number of futures short positions money managers reported holding for NYMEX natural gas contracts rose above long positions on May 21, 2019, for the first time since December 26, 2017 (Figure 11). The money manager category of the Commitments of Tradersreport, published weekly by the Commodity Futures Trading Commission, include fund managers that conduct organized futures trading on behalf of clients, and they are not involved in physical oil trading as their business activity. A short position indicates expectations of lower prices while a long position indicates the opposite. On November 13, 2018, money managers’ net long positions reached a record high. Natural gas prices increased sharply in mid-November after colder-than-normal weather reduced natural gas inventories to about 700 Bcf lower than the five-year average. In April and May 2019, however, ongoing increases in natural gas production contributed to record injections into natural gas storage, which, combined with forecasts of below-normal temperatures for June, have lowered price expectations. The natural gas front-month futures price on June 6 of $2.32/MMBtu was the lowest since May 2016.

Figure 11: MOney managers open interest in natural gas futures contracts

The professional consultants at Onyx Power & Gas Consulting are always ahead of the current issues that may affect energy consumption and pricing. Now is the time to partner with an Onyx professional consultant to discuss energy management and secure energy prices based on today’s stable pricing. Volatility in the energy markets makes it too precarious to take chances. Partner with Onyx Power & Gas in Making Energy Make a Difference!

This entry was posted in Clean Energy, CO2, Community Improvement, Consulting, Crude Oil, Crude Oil Prices, Drilling, Electricity, Electricity Prices, Emmissions, Energy, Energy Consumption, Energy Deregulation, Energy Prices, Environment, Fuel, Fuels, Gas, Generation, Green Energy, Natural Gas, Natural Gas Prices, OECD, Oil, Press Releases, Services, Shale Gas, Uncategorized and tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.