Hot US Pattern Next Week, But Overnight Weather Data Not Quite as Hot June 18-22
June 8, 2022: An interesting round of overnight weather data as both the GFS and EC maintained an impressively hot US pattern next week (image above), although wasn’t quite as hot over the East June 18-22 for the loss of a few CDDs. It will be interesting to see how the nat gas markets react to the GFS and EC being not quite as hot June 18-22 in the overnight data and whether it leads to any profit taking. It’s also possible the impressively hot pattern next week will lead to the nat gas markets turning their blind eye to cooler trends after, especially since the EC model is still several CDDs hotter compared to the GFS for much of the June 14-22 period.
Nat gas prices took a pause yesterday after spiking 10% Monday. The overnight GFS and EC maintained an exceptionally hot US pattern next week, although wasn’t quite as intimidating June 18-22 due to cooler trends across the eastern US. and could be reason if the nat gas markets give back a few cents. Then again, the nat gas markets could prefer to focus on widespread heat for next week since the past several months they tend to focus and react higher on bullish news/trends, while ignoring bullish trends. Of course, where US production comes in the next few days will also be closely watched, but with the expectation it still needs to increase by 1-2 Bcf/day or it won’t be strong enough to loosen a relatively tight supply/demand balance as deficits hold between -350 and -400 Bcf into early July. (image below shows the not quite as hot pattern June 18-22, but still pretty decent with hot conditions Texas and interior US)