As of today the extreme heat is still concentrated in the SW, West Texas and part of the plains. However, at the moment, Tuscaloosa (Roll Tide) and Madison (Go Badgers) are both showing the same temperature. But despite these much more mild current temperatures in the US, especially in the SE, we are still not seeing the injections into gas storage that we would like to be seeing right now. While today’s report of a +46 BCF storage build (slightly below expectations) was 5 BCF stronger than last year it was also -26 BCF off the 5 year average. This still leaves us -319 BCF behind last year’s pace. I am not sure yet how other analysts are viewing the report, but to only inject +46 BCF into storage when much of the air conditioning demand is idling is very disappointing.
Certainly the warmer weather forecasts along with gas production concerns played a major role in pushing the July gas contract off of its recent $2.877 /Dth low to its close yesterday at $3.067 /Dth. With the August contract moving to the front position there was an attempt to push higher but the Bulls just could not gain ground today so we saw the August contract close at $3.042 /Dth in its first full day as prompt.