Mother Nature must be a natural gas bull, as after selling later last week the front of the natural gas strip rallied today on colder long-range forecasts over the weekend. The November contract spiked around 2.5%, with much of that coming in the Sunday evening gap.
The role of weather was clearly seen along the strip, with contracts at the front spiking but the rest of the strip far more muted.
Of note was another very significant increase in the February/March contract spread, as traders remain concerned that low stockpiles could create gas delivery issues during peak cold/demand this winter.
We highlighted these colder forecast changes in our Morning Update, where the medium-range forecast was actually seen holding the largest revision.
The Climate Prediction Center then picked up on that this afternoon as well in the 6-10 Day outlook.
