The end of the week is bringing significant increases in natural gas futures prices. U.S. gas is up about 2.5%. Gains are even stronger in Europe, where prices are rising by more than 4%.
Today’s commodity-market session is characterized by a combination of several bullish factors for gas prices on both sides of the Atlantic.
- Hurricane Isaias: The first and very late hurricane this season is affecting the supply chain. According to the EIA, 57% of production in the Gulf of Mexico region has been shut in (around 1.13 bcm).
- The first winter temperature forecasts are being released. Importantly, the European ECMWF and the U.S. GFS show different estimates, which significantly increases market uncertainty. This uncertainty is particularly important in a market destabilized by the conflict in the Persian Gulf.
- The scale of the rise is partially limited by yesterday’s EIA storage report. Inventories increased by 85 Bcf versus expectations of around 79 to 82 Bcf.
NATGAS (D1)
The price remains in a broad consolidation between about $2.6 and $3.4, but the short-term trend is starting to take on a more bullish character. RSI (14) at around 60 may indicate the relative strength of buyers, though it is still far from overbought levels. Source: xStation5
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