The NYMEX December natural gas futures contract swung almost 13 cents from early Wednesday to settle 5.7 cents higher at $2.690/MMBtu despite expectations for storage inventories to set a new record Thursday and projections for above-average temperatures to continue into the latter half of November.
According to Phil Flynn, senior market analyst with Price Futures Group, a possible jolt to the natural gas market came in the form of a one-two punch of oil prices rebounding and the stabilization of the stock market following the announcement of the election of Donald Trump as president-elect, helping to provide a "relief rally" in the natural gas market.
However, movement of the prompt-month contract may be heavily influenced by the upcoming US EIA weekly gas storage report and the National Weather Service's latest weather projections calling for above-average temperatures over the Chicago and New York City markets into the latter half of November.
A consensus of analysts surveyed by S&P Global Platts estimate a 51-Bcf build for the week ended November 4, which would push storage levels above the previous record of 4.009 Tcf nearly two weeks earlier than 2015. An injection in this range would sit below the 58-Bcf from a year ago, but well above the five-year average of 38 Bcf.
Concurrently, national production is projected to average around 70.7 Bcf/d, according to data from Platts Analytics' Bentek Energy. In particular, Northeast production has fluctuated over the last few days after reaching 22.81 Bcf/d over the weekend, the highest level since August, signaling that production levels have rebounded from October lows and will remain stable heading into the winter.
The NYMEX settlement is considered preliminary and subject to change until a final settlement price is posted at 7 pm EST (2400 GMT).
