Thursday, February 14, 2019 at 4:59PM
The March gas contract was initially strong this morning on higher daily power demand and small GWDD additions overnight, though a smaller-than-expected storage withdrawal last week as announced by the EIA pulled the contract down to near flat into the settle. The March contract was the only one near flat on the day, as the rest of Cal19 was incredibly weak. The result was that the March/April contract spread finally began to recover after recent losses. Spreads were weak this morning initially but did not recover following the EIA announcement that only 78 bcf of gas was withdrawn from storage versus our expectation of 82 bcf. This was very slightly tighter than last week's number but still quite loose overall, which helps explain recent weakness in the gas market. Afternoon weather model guidance ticked colder, though not really enough to have a significant impact on the market. Heading into the weekend we expect traders to be positioning for the risk of yet another gap, as we have seen significant weather changes each of the last several weekends that have led to very active gas markets on Monday. We outlined our early weather expectations in our Afternoon Update today, and tomorrow in all our research will focus on how weekend weather changes can look to drive gas prices into early next week. Try out a 10-day free trial here to give all that research a look.