The NYMEX January natural gas futures contract settled 3.2 cents lower Wednesday at $1.79/MMBtu on continued mild weather around the US.
The January 2016 contract has been partying like it's 1999, or actually trading like it, hitting fresh lows every day this week. Wednesday's close was the lowest prompt-month settlement since it hit $1.759/MMBtu on March 24, 1999, a price now in the contract's sights.
The National Weather Service's six- to 10-day forecast calls for unusually warm weather in the Northeast, Upper Midwest, Midcontinent and Southeast. The eight- to 14-day outlook also calls for above-average temperatures across most of the country, with the western one-third expected to be slightly below average.
"The natural gas market remains under downward fundamental pressure from a temperature forecast that continues to trend relentlessly warmer," Citi Futures Perspective analyst Tim Evans said in an email.
Total demand in the Lower-48 states is about 80.7 Bcf/d, 4 Bcf/d below where it was the same time a year ago, according to data from Bentek Energy, a unit of Platts.
A consensus of analysts that Platts surveyed expects the US Energy Information Administration Thursday to estimate a pull from natural gas storage stocks between 38 Bcf and 42 Bcf for the reporting week that ended December 11.
A withdrawal within those expectations would be less than the 61-Bcf pull reported at this time in 2014 and substantially less than the 120-Bcf five-year average draw, according to EIA data.
The wider range of analysts' expectations for this week was for a draw of between 24 Bcf and 64 Bcf.
The January gas contract traded Wednesday in a range of between $1.775/MMBtu and $1.831/MMBtu.
The NYMEX settlement is considered preliminary and subject to change until a final settlement price is posted at 7 pm EST (2300 GMT).
