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12:26 PM · 23 October 2020

⛽Natgas in retreat after rollover📉

The price of natural gas is in reverse, which is followed by a significant 10% rollover. It is worth noting that such large differences in contracts in the autumn period are caused by the weather factors. Currently, the weather forecasts rather support the pro-growth prospects in the market. Forecasts for the next 6-10 days indicate that temperatures will be lower than usual, while within the next 8-14 days temperatures will be moderate compared to the average. Still, the forecasts for the coming weeks indicate lower temperatures. In addition, the currently raging storm in the Gulf of Mexico may turn into a tropical cyclone, which may affect the production and export of LNG gas.
But where did the drops come from? This is the effect of a significant increase in inventories. Yesterday inventories increased by 49 billion cubic feet, against the previous increase of 46 billion cubic feet. Interestingly, however, a higher increase was expected. The seasonality shows that we should expect  rising prices until the end of October, followed by a consolidation at high levels. The futures curve indicates significant price drops due to lower demand from the beginning of next year.
Natural gas price is retreating after yesterday's 10% rollover. The seasonality related to the heating season indicates strong increases within the next 2 weeks. On the other hand, if there is no stronger demand, the supply of this commodity is very large in the United States. Gas is also heavily overbought by speculators. Source: xStation5
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