For the second time in 2018 the prompt month natural gas contract went 30 cents limit up as bullish weather risks combined with continued fear about low storage levels to shoot the winter natural gas complex higher.
It was the March contract that made the largest move higher today, as it was the original contract to go limit up this morning. It settled up over 40 cents on the day.
This was not particularly a surprise, as this morning we reiterated slightly bullish sentiment given continued cold weather risks and low storage fears. Our sentiment was “Slightly Bullish” as GWDD additions were not particularly impressive, but $4.1 was still one of our targets eyed for the day.
We warned as well that gas prices were likely to set a new high later in the day following a mid-morning pullback.
These trends came with only modest overnight GWDD additions.
However, storage levels remain incredibly low, making the market uniquely sensitive to any colder weather trends, and long-range blocking signals continue to indicate cold is at least likely to get locked in across the Northeast.
Other balance dynamics are not helping the bear natural gas case either, with LNG exports continuing to sit near highs.
