Natural gas prices for January ’16 delivery were down almost 8 cents to $2.267 on Tuesday as natural gas-weighted demand days continued to fall.
The latest 06z GFS run showed a total of only 305.1 demand days, over 100 demand days less than just a couple days prior. The fall in demand days is attributed to a significant decrease in demand during the first part of December. Previous models showed upwards of 30 daily demand days in the first few days of December. Now, those same days are only showing approximately 15-19 daily demand days.
The fall in prices comes as the U.S. Energy Information Administration (EIA) is set to release its Weekly Gas Storage Report on Wednesday vice its traditional reporting day of Thursday due to the Thanksgiving holiday. Estimates range from flat storage (0 Bcf) to a injection of 5 Bcf.
“I’ve been saying since August to watch out for a warm December. Numerous forecasters have stated the same. I think we retest 2012 lows in the $1.90s and we see the full capitulation in December that we have long been awaiting. I look forward to the start of a long position when that occurs,” said Kingston.
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