Monday, September 16, 2019 at 2:01PM
For a couple of days last week, it looked like the abnormally hot pattern in place was finally ready to fade away, but weather models over the weekend jumped notably hotter for the second half of September. Here is today's GFS ensemble forecast for next week, for example. Back on Friday, this is what the forecast looked like from the same model, valid the same dates. Given that the change included a hotter southern half of the U.S, this was enough to boost natural gas demand compared to forecasts back on Friday, as seen in our forecast Gas-Weighted Degree Day (GWDD) change in our morning update. This September's projected GWDD total is among the highest in the historical dataset. While of course not the sole reason for the large natural gas rally over the last few weeks, it has definitely been about as supportive as weather can be at this time of the year. Should the run of warmth last a few weeks longer, however, it would transition into a bearish factor. Some models, such as the CFS, indicate such a possibility, which is tough to argue with, as warm-dominated as the pattern has been since late June. CFS October outlook: That said, persistence works until it doesn't, and the weather world can turn on a dime. That's where our research comes in handy, in order to anticipate changes before they occur and stay a step ahead of the market, especially as we head into the weather-heavy colder season coming up. Sign up for a 10-day free trial here to take a closer look at all of the products we have to offer the active trader in the natural gas market.