Hot Trends for Mid-July Hold

Written by on July 8, 2019 in NatGasWeather - No comments

Monday, July 8: Since the weather data didn’t back off on hotter patterns arriving for mid-July, this could be reason if prices were to open higher. The data is hottest July 12-20th by favoring unseasonably strong upper high pressure over the southern US, while expanding to include the northern US as well, likely resulting in highs of 90s for Chicago. Also of interest, power burns last week reached 40 Bcf/day, an impressive value that shows stronger year over year demand when hot temperatures occur, helping offset stronger year over year production. Where the pattern remains hottest is July 13-20 as upper high pressure strengthens out of the southern US and across the central and northern US where highs of 90s are likely from Minneapolis to Chicago for strong national demand, aided by mid-90s to 100s across the southern US and Plains. Prices have held Friday’s gains but have given back much of the gap higher open from Sunday Evening.

 

 

The weekend GFS model trended hotter to gain 8-9 CDD’s, seeing a hot ridge over much of the US.

 

Accumulated CDD’s were off to a slow start this summer/hot season since June 1st but will rapidly push above the 30-year average as July progresses on upcoming heat and is likely to be 2% above it by July 31st. For comparison, last year (2018) was a hot summer, while 2014 is the coolest summer since 2010. Overall, we continue to expect mid-July into September to be quite hot for much of the country where summer accumulated CDD’s increase and remain above average for all of August into September.

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