four weeks ago this year was + 81 BCF versus last year
three weeks ago this year was +23 BCF versus last year
two weeks ago this year was - 88 BCF versus last year
one week ago this year was -147 BCF versus last year (and last week was warm in NE)
the surplus is disappearing whether the weather is cold or not. That points more to supply. Read the earnings transcripts from the top 10 nat gas producers and when they have reduced drilling by 80% it is just a matter of time until the surplus is gone and nat gas is over $4 then over 5$. Colder weather just makes it happen faster
Demand has inched up for several reasons as has production.
The major factor in that ballance is that Nuclear shut downs have been higher than normal for this time of year due to earlier maintenace. So as they come back on line and the weather starts to warm there will be less shut downs and less demand than normal for n-gas in early spring and maybe even March.
Then remember that there are still many wells waiting to hook into the pipe lines soon.
( I read somewhere it was over 1000)
That will cause a double whami effect to the price and $2 N- gas may a reality again.
All this weather speculation week to week and demand fluctuations compared to the same week as last year are just small bumps in the road of the over all Natural Gas Glut.
I read somewhere, I think it was powerburn, that the amount of NG used per degree of temperature has increased considerably. In other words we're using more NG at any given temperature. I think we have a stagnant supply with increasing demand. Demand is shifting right at any temperature. The fact that it's much colder than last winter should easily lead to larger than average draws against the 5 year average and certainly more than last years draw in that nonexistent winter. The rate of decrease depends to an extent on how much switching to coal occurs as some have pointed out, but in any case it's bullish for both coal and gas. They should both benefit. I think NG is very cheap under $4. That's why it's moving so fast. We were there in OCT-NOV in temperate weather. It nosedived after then because people predicted that we would have another nonexistent winter and the glut of last winter would reappear. That's incorrect obviously and price is adjusting in a hurry, just to get back to where we were. I'm not a chart expert but there's a little bit of an inverse head and shoulders pattern going on here. I really don't see why some people want to try and call a top every thirty minutes on the way up. Well actually I do. UNG has been falling for 5 years on contango and oversupply. That seems to be all some people know how to invest on. Telling them the oversupply is gone, that demand is picking up, that it's cold, and that the contago is either weak or even backward, it's like telling them you ran over their dog or something.
I don't think UNG is the best vehicle for the rebound in nat gas prices but I think that nat gas is going to be a nice area to make some money for a few years. One part of that is a large number of people that have it wrong and are looking at the wrong data.
There seem to be many factors involved in ng pricing. The ng supply was the same today as it was on July 13th of last year. At that time the price of ng was $2.92 eod spot and today $3.49 eod.
Working gas in storage was 3,168 Bcf as of Friday, January 11, 2013, according to EIA estimates. This represents a net decline of 148 Bcf from the previous week. Stocks were 147 Bcf less than last year at this time and 316 Bcf above the 5-year average of 2,852 Bcf