Waiting On Hotter June Weather Patterns

Written by on June 3, 2019 in NatGasWeather - No comments

Monday, June 3: Going into the weekend, weather patterns weren’t hot enough to impress, and they still aren’t as the weekend weather data failed to trend hotter. Specifically, the GFS were impressively consistent with both showing a net change in Total Degree Days (Heating + Cooling) of less than 1 TDD, a rare feat. Most importantly, they both continue to show a not nearly hot enough pattern through June 17th. We see potential for stronger heat building around June 18th, although that’s far out and would need a greater amount of weather data to come on board for the markets to expect bearish weather headwinds to finally end. There’s still expected to be bouts of hot conditions across the southern US, such as what’s currently occurring with highs of upper 80s to mid-90s across Texas and Southeast to drive most of the nation’s demand. Where there’s not much demand is across the northern half of the country where temperatures will be quite comfortable during the first half of June with highs mostly in the 70s and 80s. There will still be brief cool shots across the northern US in the weeks ahead, such as what’s racing across the Upper Great Lakes and Northeast. But with highs from Chicago to NYC remaining in the upper 60s to 80s into the foreseeable future, national demand just won’t be strong enough to prevent larger than normal builds from continuing. We expect the weather data will add a little demand to the 15-day forecast in the days ahead, but the nat gas markets will have to wait a little longer for any truly ominous heat to build. We view $2.50 as the new level bears hope to keep prices under after slicing right through it Friday.

A relatively hot pattern to start the week over the southern US with highs of 90s and why national demand will be highest today then easing.


 

The pattern late this week just won’t be hot enough to impress as a weather system tracks across Texas and the South with showers and minor cooling. It will still be warm, but coverage of 90s will decrease.


 

The 15-Day HDD/CDD totals from both the GFS and European models continue to show near normal daily totals, which will result in solidly larger than normal builds due to very strong production. The GFS is a little hotter than the European model, but still to the bearish side.

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