"Overall, strong demand in the Western half of the...

"Overall, strong demand in the Western half of the USA..........."
"Shrinking European surpluses........."
"LNG exports from the US will increase......"
The future for gas is looking good.

Natural Gas Price Fundamental Daily Forecast –Turning Bullish on Expectations of Increased US LNG Exports

The bullish newsappears to be shrinking European surpluses. This is the real surprise because Idon’t think a lot of the short-sellers saw it coming.

James Hyerczyk

12 hours ago (Aug19, 2020 07:04 AM GMT)

Natural gas futures are trading flatearly Wednesday after posting a dramatic reversal to the upside the previoussession. The move was strong enough to drive the October futures contractthrough its May 2020 high and into levels not seen in over a year.

Natural Gas Intelligence (NGI) said,prices soared as “traders attempted to close the massive gap between the frontof the curve and the winter contracts. Despite little change in the fundamentalbackdrop.”

Meanwhile, spot gas prices were mixedas California heat was seen fading in the coming days. NGI’s Spot Gas NationalAverage plunged 23.0 cents to $2.300.

At 06:45 GMT, October natural gas futures are trading $2.560, up $0.004 or +0.16%.

Short-Term WeatherOutlook

According to NatGasWeather, “Hotconditions continue across the western and southern U.S. with highs of 90s and100s, hottest in California and the Southwest. Weather systems with showers andcomfortable highs of 70s to 80s will bring light demand to the Midwest,Mid-Atlantic, and Northeast.

Warmer temperatures will gaincoverage over the eastern half of the U.S. this weekend into early next weekwith highs of lower 90s returning across the East Coast.

Overall, strong demand in the westernhalf of the U.S. and moderate for the eastern half. “

Daily Forecast

The price action so far in August isvery encouraging for bullish traders. For months, the nearby markets have beenrangebound, but today’s breakout over the May top may be signaling that thereare strong buyers out there.

This summer, the markets haveperformed remarkably well despite unusually high storage levels, demanddestruction from COVID-19 and the steep plunge in crude oil prices. The recentprice action suggests that the worst may be behind us.

The major bullish factor appears tobe shrinking European surpluses. This is the real surprise because I don’tthink a lot of the short-sellers saw it coming. The European economy appears tobe recovering from coronavirus faster than the U.S. economy. Furthermore, theyhave money to spend now that the European Union has promised stimulus.

We’re starting to see reducedcancellations in European LNG exports, which is a positive sign for prices.This is increasing expectations that LNG exports from the U.S. will increase inthe months ahead.