In an EBW Analytics Group report despatched to Rigzone by the EBW group on Thursday, Eli Rubin, an vitality analyst on the firm, outlined that the “$5.00 [per million British thermal units (MMBtu)] psychological threshold” is “nonetheless a related market driver” for pure fuel.
“The January pure fuel contract traded as excessive as $5.039 [per MMBtu] yesterday earlier than closing at $4.995,” Rubin mentioned within the report.
“Technicals seem supportive of additional upside, bodily costs robust, and really chilly forecasts intact,” he added.
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“DTN’s forecast for Weeks 2 and three added one other 4 gHDDs prior to now 24 hours, and the Week 4 forecast highlights enduring chilly dangers into Christmas. If frigid late-December forecasts roll ahead, it may current additional tailwinds for NYMEX upside,” he continued.
Rubin highlighted within the report that consensus projections for this morning’s U.S. Power Info Administration (EIA) weekly pure fuel storage report are for a 14 to 18 billion cubic foot draw.
“The next 4 EIA weeks, nevertheless, might complete 218 Bcf (7.8 Bcfpd) tighter than the five-year common,” he mentioned.
“LNG stays up 5.1 Bcfpd and November manufacturing upside appears to be stalling. Our almost definitely storage projection for the top of March dipped under 1,600 Bcf,” he added.
“Whereas winter 2025/26 storage seems sufficient, issues over rebuilding storage subsequent yr have led the 2026 injection season contracts so as to add 16.3 cents since Friday – even outpacing January contract features (+14.5 cents) week to this point,” he continued.
The EBW report outlined that the January pure fuel contract’s Wednesday shut of $4.995 per MMBtu marked a 15.5 cent, or 3.2 %, improve from Tuesday’s shut.
Within the report, EBW predicted a “check larger and relent” pattern for the NYMEX front-month pure fuel contract worth over the following 7-10 days and a “unstable path larger” pattern over the following 30-45 days.
In a report despatched to Rigzone by the EBW group on Wednesday, Rubin highlighted that the January pure fuel contract “set a four-month intraday excessive yesterday [Tuesday] at $4.984 earlier than stumbling on (i) climate fashions unsure of the mid-December outlook and (ii) being simply shy of the $5.00 per MMBtu psychological stage”.
In that report, Rubin mentioned “very chilly nationwide climate might peak tomorrow [Thursday], practically 10 gHDDs colder than 30-year norms”.
“Thursday stands out as the coldest day of December – however every day figures slip to hotter than regular by mid-next week. If technical resistance at $5.00 holds, this variability highlights consolidation dangers over the following 7-10 days,” he added.
“Whereas pure fuel storage might boast a 186-Bcf surplus to regular to finish November, nevertheless, forecasts for the coldest December since 2010 might tip storage right into a deficit by Christmas,” Rubin identified.
“A triple-digit deficit is possible to start out 2026. Reloading chilly potential into late December, if it verifies, doesn’t but seem absolutely priced-in to present NYMEX futures,” he mentioned.
Wednesday’s EBW report highlighted that the January pure fuel contract closed at $4.840 per MMBtu on Tuesday. This marked an 8.1 cent, or 1.6 %, drop on Monday’s closing worth, the report outlined.
On this report, EBW additionally predicted a “check larger and relent” pattern for the NYMEX front-month pure fuel contract worth over the following 7-10 days and a “unstable path larger” pattern over the following 30-45 days.
In a market evaluation despatched to Rigzone on Thursday, Dilin Wu, Analysis Strategist at Pepperstone, mentioned “U.S. pure fuel costs have climbed sharply since late October, fueled by report LNG exports, rising electrical energy demand from AI knowledge facilities, and seasonal heating wants”.
“Quick-term upside is obvious, however medium-term enlargement dangers warrant warning,” Wu added within the evaluation.
The EIA’s subsequent weekly pure fuel storage report is scheduled to be launched later at the moment. It is going to embody knowledge for the week ending November 28.
To contact the creator, e-mail andreas.exarheas@rigzone.com
