Ending storage as of March 31 was 1,695 bcf, easily exceeding the previous record high of 1,500 bcf in March 2002 and 63% above the five year average level of 1,041 bcf. The lowest-ever storage level of 696 bcf at the end of the heating season came just a year after the previous record high.
The record level of gas in storage is weighing on the gas futures market, having sent prices more than 50% lower from their mid-December peak, but Rather sees signs that the market's overwhelming bearishness could backfire.
"With everybody and their dog short, the surprise is to the upside, not the downside," he said. "I'm still generally thinking we'll have a contrarian, bullish bias to the market. If you hold near $6.90-$7.10, that supports the contrarian view that you'll have a test of the $8.20 to $8.65 level."
AMU Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
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