Last year, when Ugaz was $8, I predicated Ugaz to $2, but finally at March 7th, Ugaz was $0.53, haha, I was too 保守.
This Year, I make a bold predicate again, Dgaz likely will be around $2 by November...
Be care, don't short NG.....
The following the Message about the EOS invenotry I posted on our group. I repost here:
EOS Inventory estimate.....
Inventory at April 1st: 2016: 2480Bcf
Inventory at August 5th 2016: 3317Bcf.
Total 18 weeks, Injection 837Bcf.. week Injection: 837Bcf/18 week =46.5Bcf/week.
if we calculate from May (since it is coldest April this year):
April 29th: inventory. 2625Bcf
Total 14 week till August 5th, injection 692BCF, week Injection: 692Bcf/14 week =49.4Bcf/week.
Usually the largest Injection happen on May, last year May-29/2015, 132Bcf, October, 9th 2015 Largest Injection 97Bcf, this year Largest injection in May is 82Bcf, and the other 2 weeks are 73Bcf, 72Bcf.
During last 4 months, US production is around 71.3Bcf/day..I believe next 3 months before winter will be not much change, Northeast last week reached 22.8Bcf/day, almost reach the Maximum Capability in March 23.5Bcf/day, other regsion was down...
Demand side : LNG export increase around 0.4Bcf/day. Mexico export increased 0,2Bcf/day compare May.
Next 2 weeks injection are on the table 25Bcf-30Bcf. the remain 2 weeks of August Definitely will be lower than 40Bcf. Usually there are 4 weeks large injection in Sept and October.
Normal winter, the last 2 week of October is very low, this year Largest Injection in Sept and Oct won't be over 75Bcf/week, likely will be 65-75BCf/week 4 weeks peak injection (according to May injection) (if Supply not increase, but Demand already increased over 0.6Bcf/day).
There are total 13 weeks remain for injections, I guess the average injection will between 46.5Bcf -49Bcf.
Let's count on 47.5Bcf/week, then total : 47.5 *13 = 617.5Bcf.
EOS will be: 3934Bcf.
Bentek Estimate is around 3900Bcf.
Ice is 3970Bcf.
2012 EOS is 3929Bcf , the NG price went up to $3.91 at early November, 2012 NG Down from $3.2 to $2.6 in August consilidation, All the traders wait for NG go down more in late Sept and October, but NG went up from Sept to early Novemeber from $2.6 to $3.9, shoulder season NG down not happened in 2012!!!.
Currently Weekly NG inventroy loose at least 25BCF/week compared to average... FA is Bullish!
The Nearest exmaple is 2014, EOS is 3611Bcf, over 200 Bcf less then average, if you based on the EOS 3611Bcf, NG should shot up over $5, but NG down below $3 at the end of 2014, why? Oversupply!!! new pipleline added at Decemeber, 2014 US Production over 73BCF/day, 3BCf/day oversupply...
Currently Demand is already over Supply, NG price increase is trend if Production not increase, NG MMs can control short term NG future price, but long term they definitely follow FA...Currently Cot report show, Hedge Funds are net long, they are biggest shorters during the last 2 years.
Another thing, LNG Export by next Summer will 2Bcf/day. 5 New Gas-fired based power plant will be online next year, Currently Demand is already over 3Bcf/day than that of last year, while total supply almost no change...if production not Increase this winter, EOS by next March likely will be around 1100Bcf-1200Bcf ( Do you know 2014 Feb highest NG price? $6.3, EOS March 811Bcf...)....
Good Luck!
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