Weekly Energy Market Watch | September 18, 2017

Jonathan Lee

MARKET COMMENTARY | For Week Ending 9/15
Natural gas rebounds on supportive weather forecast.

MONDAY 9/11
Natural gas climbed 6.0 cents to $2.950 per MMBtu as weekend weather updates favored warmer temperatures for the major consuming regions in the East into the last week of the month. Crude oil gained 59 cents before closing at $48.07 per barrel as traders assessed the damage from Hurricane Irma and the impact to demand. Equity markets jumped higher on renewed risk appetites after the devastation caused by Hurricane Irma was not as severe as anticipated.

TUESDAY 9/12
Natural gas continued to recover more of the prior week’s losses but edged closer to upside resistance in the fuel’s recent narrow trading range. The October NYMEX contract settled 5.1 cents higher at $3.001. Crude inched 16 cents higher to $48.23 after OPEC said its output fell 0.24% to 32.76 Mb/day during August. Stocks added to Monday’s rally, but gains were capped with pressure coming from slipping technology and consumer staples shares.

WEDNESDAY 9/13
Natural gas tested upside resistance as traders continued to garner support from the short-term weather forecast. The cost of gas eventually closed 5.7 cents higher at $3.058. Crude oil bounced $1.07 higher to $49.30 even after the Energy Information Administration (EIA) documented a 5.9 Mb increase in domestic inventories. Equities struggled to dive much deeper into record territory after three days of solid gains as investors looked to lock in profits.

THURSDAY 9/14
Natural gas managed to eke out a 1.2 cent gain to settle at $3.070 even after the EIA reported a larger-than-expected 91 Bcf injection into storage. Oil prices edged 59 cents higher to $49.89 after the International Energy Agency reported global supplies dropped by 720,000 barrels per day in August and upwardly revised full-year growth forecast to 1.6 million barrels per day. Equity markets traded in a mixed fashion as climbing transportation stocks offset declines in brick-and-mortar retailer and technology shares.

FRIDAY 9/8
Natural gas gave back 4.6 cents to end the week at $3.024 traders continued to consider Thursday’s large storage injection. Crude was unchanged on the day, finishing the session at $49.89. Stocks, meanwhile, carved out fresh record highs as investors shook off the day’s lackluster economic data and North Korea’s latest missile launch over mainland Japan.

LOOKING AHEAD

Crude oil and natural gas traders will continue to gauge the supply and demand balance to determine near-term price direction.

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