Gas Petrospective – November 30, 2011
Natural gas prices turned right back up again yesterday as traders gave in to short-covering on oversold pressures and as end-users decided that recent levels are as good as any as a decent place to start accumulating long positions for the coming winter. And, any look at a calendar quickly disabuses one of any notion that the weather will take its time to turn chilly. It is December tomorrow, and any quick look at the family picture album can remind one that this is the coldest month of most years. It’s actually in second, close second, just behind January. The “Heart of Winter,” or the coldest part of most years runs from December 15th to January 31st. The last 15 days of December can often be colder than anything in January, but the cold part of January has twice as many days. Nonetheless, December can do a number on heating degree days.
If the temperatures start to fall early in December, it can easily be the coldest month for the year. If they wait, then January will be the coldest. But, by the end of January, the coldest days, although not always the snowiest, have almost always come and gone. This makes temperature forecasts over the next two weeks critical.
We have lots of supply. The EIA recently reported lower 48 output up 6.9% on the year to 70.4 bcf/day. But winter is why we have an entire season dedicated to injecting gas into pipelines. No matter how much we produce, it is never enough to meet consumption. Winter is why we have storage and why we build it each year to new highs.
Technical Recap
Natural Gas Options Report
Premium Subscribers (click here to register):
Volumes & Open Interest
End Of Day Straddles
Trade Blotter
Settlements
To view our energy news and articles on your PDA or mobile device, click here.
-----
About FMX: FMX Connect is an information, data, and analytics portal for Commodities. The portal provides an all-in-one package including essential market data, independent third party research, industry news, and commodity trading tools. FMX Connect provides efficient, effective, and thorough data that bridges all aspects of commodities onto one screen. The Result; A user friendly application for hedge fund traders, OTC brokers, individual investors, and industry participants.
-----
Note: The information presented, while from sources generally believed to be reliable, is not guaranteed and may not be complete. FMX | Connect makes no representations or warranties regarding the correctness of any opinions or information. Past results are not necessarily indicative of future results. Nothing in this report should be construed as a representation to buy or sell shares, futures or options, which contain considerable risks. For internal client distribution only. Any reproduction, re-transmission, or distribution of this report without permission is prohibited. Media correspondents or reporters may not quote any one page or section in its entirety and must attribute all quotes, ideas or concepts herein. Copyright FMX | Connect, ©2009-2010. All rights reserved.