US natural gas futures are up more than 2% Monday after new models forecast warmer weather.
Futures for September delivery gained 2.33% to $3.952 Metric Million British Thermal Unit as of 1045 ET in New York.
According to Bloomberg, the weather forecast for Aug. 16-21 is expected to be “much warmer” across the south-central and the eastern US. Much cooler conditions are forecasted for the west and the north-central US.
For the week ending Aug. 21, cooling degree days (CDD) for the US is forecasted around 11 CDD, more than the long-term averages for this time of year. This week’s CCD will be about 77, last week’s was 93, and the norm for this week is approximately 66.
Here’s the weekly CCD forecast with the most significant deviations from averages:
- Pacific: 75 forecast versus 43 normal
- Mountain: 88 forecast versus 68 normal
- E N Central: 54 forecast versus 43 normal
- Nevada: 147 forecast versus 105 normal
- Minnesota: 69 forecast versus 28 normal
- Utah: 80 forecast versus 46 normal
For readers who aren’t familiar with CCD forecasting, it’s the number of degrees that the mean daily temperature is above 65 degrees Fahrenheit. Higher values indicate hotter temperatures and increased demand for air conditioners which boosts demand for natural gas.
The good news is that the dog days of summer could be winding down as the average temperatures for the US Lower 48 are set to drop after Aug. 26.
On another relevant subject about the weather. We told readers late Sunday that three storms are brewing in the tropics.