Provident Energy Consulting

NYMEX December Gas Rolls Off Board 45.3 Cents Higher on Production Slide

NYMEX December natural gas futures rolled off the board as the frontmonth contract Wednesday at $4.715/MMBtu, up 45.3 cents from Tuesday's close.

The increase came as production fell to its lowest point in a week.
Wednesday’s extraction from wells was set to total 97 Bcf, down about
900 MMcf from Tuesday’s output of 97.9 Bcf, according to S&P Global
Platts Analytics.
Over the past week, production has averaged 97.7 Bcf/d. So far this
month, production has averaged 96.7 Bcf/d, up 9.6 Bcf/d from the
November 2017 average of 87.1 Bcf/d.
Also factoring in the price rise was a bullish US National Weather
Service forecast that calls for colder-than-normal weather over much
of the US for the next two weeks. After that, frigid weather is expected
to linger for the rest of December for major demand areas in the
Northeast and Upper Midwest.
Combined demand in those two regions remained elevated
Wednesday at around the 46.3 Bcf mark. So far this month, Upper
Midwest and Northeast demand has averaged 39.1 Bcf/d.
The unseasonably low temperatures were reflected by national
figures for residential and commercial demand as residents started to
fire up their furnaces. Consumption from those sectors checked in at
44.8 Bcf Wednesday, the third straight day that demand topped 40 Bcf
and 8.2 Bcf/d above than the month-to-date average of 36.6 Bcf/d.
With the arrival of winter, substantial withdrawals from storage
have been seen. Platts Analytics estimated Wednesday’s draw at 18.6
Bcf, the third straight day of double-digit pulls.
The pull from stocks has been robust this month, averaging 7.9
Bcf/d. In November 2017, the average withdrawal was 3.5 Bcf/d.

Source: Platts 2018

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