It's Not All Doom And Gloom For Natural Gas

Just as everyone is about to throw in the towel for natural gas, a potential bright spot appears. In the latest weather model update, the back end of the model gained meaningful heating degree days.

TDDs

10-15 Day

15-Day Cluster

And if you look at the breakdown in the weather models, you can see the return of the Alaska ridge by the 10-15 day timeframe. The only issue that we see with this projection is that it's still very uncertain. Given the recent weather volatility, it's highly likely that we could see dramatic changes in this pattern, which will translate directly to price volatility. 

But if you forced us to give you our take on the incoming price trend, we would say with a high degree of confidence that the very bearish weather is now behind us. What you are seeing over the next 15 days is likely to be peak bearish weather for a while.

This is good news. In our latest storage projection, you can see the large revisions in 2/2 and 2/9 weeks. But this is offset by the bullish storage projection for 1/26 week.