The Weekly Natural Gas Market Newsletter

July 19, 2021

Natural Gas News & Notes

The August 2021 NYMEX natural gas future's contract traded flat on the week after trading in nearly a 20-cent range. The contract saw a high of $3.77 early in the trading week and a low of $3.58 on Friday morning before settling at $3.674 for the week. The contract has been stuck in about a 30-cent range bound trade between $3.50 and $3.80 since the beginning of July. The contract has attempted a breakout in both directions but has been unable to do so yet.

The weekly natural gas storage report indicated an injection of 55 BCF for the week ending 7/9. This was a bit higher than expected as analysts had projected a build in the mid 40 BCF range. Despite what would be deemed as a "good" miss for storage, inventories are still 17.1 % below year-ago levels and 6.7% below the previous 5- year average.

The Aug21 contract looks to continue its range bound trade this week. The contract sill has more upside price risk than downside price gain. Support in the $3.55-$3.60 range should hold and is deemed as a solid buying level for end-users with any open exposure for August. With the heart of summer still looming, a surge in gas fired power generation to meet the cooling demand is expected. The probability of seeing a $4.00 price point on a prompt month NYMEX contract looks extremely likely in the coming weeks.