The Daley Note - (Please Don’t) Drill Baby Drill
Natural gas futures have fallen hard, breaking below $3/MMBtu for the balance of winter. While a freakish turn in the weather is contributing to bearish sentiment, the bigger problem in East Daley’s view is overheated supply growth.
The decline has been swift for natural gas, down by 60% since late December. Henry Hub was trading near $7/MMBtu ahead of the holidays, when a bitter Arctic front swept over the US and sent demand surging to an all-time high, according to the Energy Information Administration. But temperatures in key Midwest and Northeast markets then rapidly warmed and have remained mild through January, leading to several weeks of below-normal storage withdrawals. Read more.
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Natural Gas Weekly
East Daley Analytics' Natural Gas Weekly provides an update every 7 days to our monthly Supply and Demand forecast. The update covers rigs, flows, production, prices, and capacity constraints that materially change our view on supply and demand. This update highlights what investors and traders need to keep their eye on in the natural gas markets to ensure they are on the right side of the market. Subscribe to Natural Gas Weekly below.
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