https://seekingalpha.com/article/4210092-thing-holding-back-upward-explosion-natural-gas-prices
This Is The Only Thing Holding Back An Upward Explosion In Natural Gas Prices
Oct. 5, 2018 12:19 PM ET
HiddenValueInvestor
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Natural gas in storage is on pace to be at historic lows entering the winter 2018-2019 season.
The current NOAA forecast is for a warmer-than-normal winter temperature pattern.
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The NOAA is currently forecasting a warmer-than-normal winter. If the forecast changes to colder than normal, then investors can expect an upward surge in natural gas prices.
The
ONLY THING preventing a substantial upward surge in natural gas prices is the most recent NOAA prediction for the winter season seen below:
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What investors need to understand is that the above forecast for warmer-than-normal winter temperatures is the current estimate. The pattern could change between now and December, and therefore this forecast can also change as we get closer to December. The estimate could get even warmer, or it could get colder. If the winter is warmer than normal, then there is enough natural gas in storage to get through the winter without shortages. That is what natural gas bears are hanging their hat on right now. But if the forecast flips to colder than normal, and that verifies, then parts of the country will not have enough natural gas to meet demand in the last part of the winter.
Seeking Alpha recently reported that Citi analyst Anthony Yuen estimates Henry Hub spot natural gas prices could rise to $12 to $16 per Mcf if the winter is much colder than normal. Current natural gas futures prices are $3 per Mcf.
