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"Natural Gas Trading Picks Up Considerably Amid High Volatility" by Charles Kennedy - ...And is U.S. NatGas Futures dramatically overbought at the $6.35 range?

Tom Nolan in Nat Gas / LNG

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2 hours ago, Tom Nolan said:

https://oilprice.com/Energy/Natural-Gas/LNG-Terminals-In-Europe-Are-Filling-Up-Fast.html

LNG Terminals In Europe Are Filling Up Fast

By Tsvetana Paraskova - Apr 30, 2022, 6:00 PM CDT

  • Europe’s LNG terminals are maxed out as the region continues to import record amounts of gas.
  • Europe is likely to import even more LNG in the coming years to displace as much Russian gas as possible.
  • As a result of the EU’s new energy policy, natural gas and LNG prices are expected to remain elevated for years to come.

Europe is importing record volumes of liquefied natural gas (LNG) as it looks to cut as much Russian gas consumption as soon as possible. Unlike in previous years, Europe is now the most attractive destination for global LNG flows, outbidding Asia for spot supply as prices and demand in Europe have soared after the EU’s irreversible decision to stop being beholden to Putin for its gas consumption as fast as feasible.  Amid soaring demand, however, LNG terminals in Europe are maxed out, limiting how many cargoes the continent can import now before planned new import and regasification terminals can be built and brought online. This has prompted suppliers keen on growing their LNG exports to Europe to offer cargoes at discounts of up to 20 percent to the prices at the Dutch TTF hub, the benchmark gas price for Europe, in order to secure slots at import terminals, traders tell Bloomberg.

Europe’s record LNG imports mitigated the gas price action after Russia halted gas deliveries to EU members Poland and Bulgaria earlier this week. After jumping by as much as 24% on Wednesday morning when Bulgaria and Poland said their Russian gas supply had been cut off, natural gas prices in Europe pared gains later in the day and even eased on the following day. This was largely due to continued high LNG imports, the EU’s vow to help affected member states, and significantly improved storage levels at the end of the winter heating season. 

Related: Libya May Reach Full Oil Production Within Days

LNG exporters are now focused on Europe as a key import market and are reportedly willing to offer discounts now in order to win more customers in the future, as the EU looks to ditch Russia as a supplier as soon as it can afford it without causing a recession. 

Even before the Russian invasion of Ukraine, Europe was plunged into an energy crisis in the autumn of 2021, with low levels of gas in storage and rebounding industry demand post-COVID. The war in Ukraine made Europe rethink its energy strategy, and the European Union has now drafted plans to cut EU demand for Russian gas by two-thirds before the end of 2022 and completely by 2030, possibly by 2027. 

Strong LNG demand in Europe while China grapples with fresh COVID-related lockdowns suggests that Europe will continue to be the preferred destination of spot LNG cargoes at least this year and next. The EU will seek to replenish gas in storage levels before next winter so it will be more prepared if—or rather when—Russia decides to halt gas flows to more EU customers, as it already did with Poland and Bulgaria. 

Europe will also look to import more LNG in coming years to displace as much Russian gas—which met 40 percent of EU consumption pre-war—as soon as possible. One of the most dependent large economies, actually the biggest economy in Europe, Germany, plans to build two LNG import facilities; one at Brunsbuettel and one at Wilhelmshaven. Germany doesn’t currently have any LNG import terminals. In March, German LNG Terminal and Shell signed an agreement under which the supermajor will make a long-term booking of a substantial part of the Brunsbuettel terminal’s capacity for importing LNG.  

Germany, which until two months ago had only sporadically thought of LNG import terminals and imports, now seeks a long-term deal with one of the world’s top LNG exporters, Qatar.  

As a result of the EU’s new energy policy, natural gas and LNG prices are expected to remain elevated for years to come.  

“Gas prices will remain high until 2026 at least. Europe wants to rapidly minimize the 150 Bcm of Russian imports that meet about one-third of its demand. There’s nowhere near enough alternative gas supply available for the next four years until new volumes of LNG from the US and Qatar become available,” Simon Flowers, chairman, and chief analyst at Wood Mackenzie said this week. 

“Meanwhile, for Europe, it’s about maximizing pipeline imports from Norway, Azerbaijan, and North Africa; outcompeting Asia for flexible LNG; and managing demand. Throughout this period, Russia has leverage and can manipulate volumes; after 2026, prices should ease,” Flowers noted. 

By Tsvetana Paraskova for Oilprice.com

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LNG Terminals In Europe Are Filling Up Fast

https://finance.yahoo.com/news/lng-terminals-europe-filling-fast-230000165.html

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https://oilprice.com/Latest-Energy-News/World-News/The-US-Has-Lost-Its-Position-As-The-Worlds-Top-LNG-Exporter.html

The U.S. Has Lost Its Position As The World’s Top LNG Exporter

By Julianne Geiger - May 02, 2022, 2:30 PM CDT

After briefly surpassing Qatar and Australia as the world’s top LNG exporter, the United States lost the top slot to Qatar in April as volumes in the north dropped along with heating fuel demand, Bloomberg reports. 

Bloomberg data now shows that Qatar exported 7.5 million metric tons of LNG in April.

American LNG production was somewhat reduced in April, Bloomberg notes, due to the end of the winter season and lower demand for heating fuel.  

With promises to help the European Union replace Russian gas and a new American export terminal due to come online soon, however, the U.S. could once again reclaim the top spot later in the year.

In March, U.S. LNG exports rose 16%, according to Reuters. 

Soaring demand for U.S. LNG has now rebooted export projects that had previously languished, and the Biden administration has approved new export licenses for projects under development. 

Last week, the Biden administration authorized more LNG shipments from two U.S. plants under development. The move came as Russia cut off gas to Poland and Bulgaria for refusal to pay in roubles.  

One of those plants is Texas-based Golden Pass LNG, which is owned by Exxon and Qatar Petroleum and is expected to go online in 2025. The second is the Louisiana-based Magnolia LNG, owned by Glenfame Group LLC and expected to launch in 2027.  

Another factor adding to U.S. LNG exports in the coming months will be the ramp-up launch, on April 29, of the Louisiana-based Calcasieu Pass export terminal, which is the seventh export terminal to begin production in the United States since 2016. This terminal can turn around 3.1 billion cubic feet per day, according to the EIA, with two shipping berths that can load up to 185,000 cubic meters.  

Calcasieu shipped its first LNG on March 1st, and natural gas deliveries to the terminal have steadily increased since the beginning of the year. Three blocks are still awaiting approval at this plant, expected by year’s end. 

By Julianne Geiger for Oilprice.com

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On 4/29/2022 at 11:28 AM, Tom Nolan said:

BULGARIA - GREECE

https://www.yahoo.com/news/gas-pipeline-boosts-europes-bid-063706779.html

New gas pipeline boosts Europe's bid to ease Russian supply

ATHENS, Greece (AP) — Mountainous and remote, the Greek-Bulgaria border once formed the southern corner of the Iron Curtain. Today, it’s where the European Union is redrawing the region’s energy map to ease its heavy reliance on Russian natural gas.

A new pipeline — built during the COVID-19 pandemic, tested and due to start commercial operation in June — would ensure that large volumes of gas flow between the two countries in both directions to generate electricity, fuel industry and heat homes.

The energy link takes on greater importance following Moscow’s decision this week to cut off natural gas supplies to Poland and Bulgaria over a demand for payments in rubles stemming from Western sanctions over the war of Ukraine.

The 180-kilometer (110-mile) pipeline project is the first of several planned gas interconnectors that would give eastern European Union members and countries hoping to join the 27-nation bloc access to the global gas market.

In the short term, it’s Bulgaria’s backup.

The new pipeline connection, called the Gas Interconnector Greece-Bulgaria, will give the country access to ports in neighboring Greece that are importing liquefied natural gas, or LNG, and also will bring gas from Azerbaijan through a new pipeline system that ends in Italy.

It's one of many efforts as EU members scramble to edit their energy mixes, with some reverting back to emissions-heavy coal while also planning expanded output from renewables.

Germany, the world’s biggest buyer of Russian energy, is looking to build LNG import terminals that would take years. Italy, another top Russian gas importer, has reached deals with Algeria, Azerbaijan, Angola and Congo for gas supplies.

The European Union wants to reduce its dependence on Russian oil and gas by two-thirds this year and to eliminate it completely over five years through alternative sources, the use of wind and solar power, and conservation.

Russia's invasion of Ukraine is likely to accelerate changes in the EU’s long-term strategy as the bloc adapts to energy that is more expensive but also more integrated among member nations, said Simone Tagliapietra, an energy expert at the Brussels-based think tank Bruegel.

“It’s a new world,” he said. “And in this new world, it’s clear that Russia doesn’t want to be part of an international order as we think of it.”

Tagliapietra added: “The strategy — particularly by Germany — over the last 50 years was always one of engaging with Russia on energy. ... But given what we are seeing in Ukraine and given Russia’s view of international relations, it’s not the kind of country with which we would like to do business.”

EU policymakers argue that while Eastern European members are among the most dependent on Russian gas, the size of their markets makes the problem manageable. Bulgaria imported 90% of its gas from Russia but only consumes 3 billion cubic meters annually — 30 times less than lead consumer Germany, according to 2020 data from EU statistics agency Eurostat.

The Greece-Bulgaria pipeline will complement the existing European network, much of which dates to the Soviet era, when Moscow sought badly needed funds for its faltering economy and Western suppliers to help build its pipelines.

The link will run between the northeastern Greek city of Komotini and Stara Zagora, in central Bulgaria, and will give Bulgaria and neighbors with new grid connections access to the expanding global gas market.

That includes a connection with the newly built Trans Adriatic Pipeline, which carries gas from Azerbaijan, and suppliers of liquefied natural gas that arrives by ship, likely to include Qatar, Algeria and the United States.

As many as eight additional interconnectors could be built in Eastern Europe, reaching as far as Ukraine and Austria.

The 240 million-euro ($250 million) pipeline will carry 3 billion cubic meters of gas per year, with an option to be expanded to 5 billion. It received funding from Bulgaria, Greece and the EU, and has strong political support from Brussels and the United States.

On the ground, the project faced multiple holdups because of supply chain snags during the COVID-19 pandemic.

Receiving specialized parts and moving personnel after construction got underway in early 2020 soon became increasingly difficult, said Antonis Mitzalis, executive director of Greek contractor AVAX, which oversaw the project.

Construction of the pipeline finished in early April, he said, while work and testing at two metering stations and software installation are in the final stages.

“We had a sequence in mind. But the fact that some materials did not arrive made us rework that sequence, sometimes with a cost effect,” Mitzalis said.

Greek Prime Minister Kyriakos Mitsotakis missed a tour of the site last month after contracting COVID-19. He spoke Wednesday with his Bulgarian counterpart, Kiril Petkov, to provide assurances of Greek support.

“Bulgaria and Greece will continue to work together for energy security and diversification — of strategic importance for both countries and the region,” Petkov later tweeted. “We both are confident for the successful completion of the IGB on time.” ___

Follow AP's coverage of the war in Ukraine: https://apnews.com/hub/russia-ukraine

___ Follow Gatopoulos at https://twitter.com/dgatopoulos

 

 

https://oilprice.com/Energy/Natural-Gas/Greece-And-Bulgaria-Plan-New-LNG-Terminal-To-Cut-Russian-Gas-Reliance.html

Greece And Bulgaria Plan New LNG Terminal To Cut Russian Gas Reliance

By Tsvetana Paraskova - May 03, 2022, 10:00 AM CDT

  • Greece and Bulgaria started the construction of a new LNG import terminal.
  • The novel LNG terminal near Alexandroupolis is aimed at diversifying supply and cutting reliance on Russian gas imports.
  • Last week, Gazprom stopped gas deliveries to Poland and Bulgaria.

The leaders of Bulgaria and Greece launched on Tuesday the construction of an LNG import terminal near the northern Greek port of Alexandroupolis, aimed at diversifying supply to southeast Europe and cutting its heavy reliance on Russian gas.   

The LNG terminal, expected to start operations towards the end of next year, would triple Greece’s regasification capacity, Greek Prime Kyriakos Mitsotakis said at the ceremony attended by the prime ministers of Bulgaria and North Macedonia, the president of Serbia, and the President of the European Council, Charles Michel. 

Last week, Gazprom stopped gas deliveries to Poland and Bulgaria, saying supply was cut off “due to absence of payments in rubles.” 

In Bulgaria's case, Bulgaria is required to pay in U.S. dollars for Russian gas under its contract with Gazprom, and Russia's demand for payment in rubles is a breach of that contract and adds risks to the buyer, Bulgarian Energy Minister Alexander Nikolov said last week.

“It is clear that in the current war in Ukraine, Russia uses natural gas as a political and economic weapon,” Nikolov added, noting that Bulgaria will not negotiate under pressure. 

Bulgarian Prime Minister Kiril Petkov said last week that he had discussed the situation with his Greek counterpart Mitsotakis and that Bulgaria and Greece would continue to work with its neighbor towards energy security and diversification, which is of strategic importance to both countries and the region. Bulgaria and Greece are confident that the Interconnector Greece-Bulgaria (IGB), a pipeline to diversify gas supply away from Russia, will be completed on time this summer, Petkov added. 

At today’s ceremony, Petkov said that the Kremlin’s economic blackmail would fail following the united response of the EU to the halt of Russian gas deliveries to two of its member states. 

“United, we can counter the Russian invasion of Ukraine and the unprecedented pressure from Russia via the stoppage of gas deliveries,” Petkov said. The LNG terminal is not only an energy but also a geopolitical project that will change the energy map of the entire region, Bulgaria’s PM said. 

Charles Michel, for his part, commented on Twitter:

“We will end our dependence on Russian fossil fuels. This new #LNG terminal is a geopolitical investment. It will help free South East Europe from the weaponisation of gas supply by #Russia.” 

By Tsvetana Paraskova for Oilprice.com

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https://oilprice.com/Latest-Energy-News/World-News/Germanys-Uniper-Looks-To-Buy-Russian-Gas-In-Euro-To-Ruble-Scheme.html

Germany’s Uniper Looks To Buy Russian Gas In Euro-To-Ruble Scheme

By Irina Slav - May 03, 2022, 10:30 AM CDT

Germany’s Uniper is continuing talks with Russian Gazprom and the German government on paying in rubles for deliveries of Russian gas, according to a Q1 financial report, out today.

The news comes as the European Commission urges member-state governments to shun Russian gas amid preparations for an embargo on Russian crude oil imports.

Uniper, which is one of Germany’s top gas buyers from Russia, said last week it was going to accept Gazprom’s new terms for gas payments.

"The plan is to make our payments in euros to an account in Russia," a company spokesperson told German media, as cited by Reuters last Thursday. Since then, however, the EC has stepped up pressure on European gas importers.

Yesterday, the Commission reiterated its warning that paying for Russian gas in rubles would constitute a breach of EU sanctions on Moscow for its invasion of Ukraine.

Per the new Russian terms for payments, any buyer of Russian gas from any unfriendly country needs to open two accounts in Gazprombank: one in the foreign currency it wants to pay in and one in rubles.

When a gas payment is due, the buyer deposits the necessary sum in dollars or euros in its first Gazprombank account. The bank then converts the sum into rubles under Russian central bank exchange rates and deposits it in the second account, from which the actual payment is made.

"Paying roubles through the conversion mechanism managed by the Russian public authorities and a second dedicated account in Gazprombank is a violation of the sanctions and cannot be accepted," said Energy Commissioner Kadri Simson on Monday.

The European Union received some 40% of its imported natural gas from Russia along with 26% of its imported crude oil. The bloc has substantially stepped up its efforts to find replacement supplies in the last few weeks.

By Irina Slav for Oilprice.com

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https://oilprice.com/Latest-Energy-News/World-News/European-Natural-Gas-Prices-Continue-To-Slide-As-LNG-Imports-Surge.html

European Natural Gas Prices Continue To Slide As LNG Imports Surge

By Irina Slav - May 03, 2022, 9:30 AM CDT

Natural gas prices in Europe on Tuesday extended a slide that began three days ago thanks to forecasts for warmer weather coming to Europe along with LNG shipments seen as offsetting the danger of a cutoff of Russian gas for the EU.

Bloomberg reported that gas futures had slipped by over 3% before recouping some of the losses, but still down from yesterday.

Meanwhile, the European Commission is racing to provide legal clarity for payments in Russian rubles amid calls from major importers that they are still not certain whether such payments would breach EU sanctions on Russia.

“It’s very important that the EU Commission gives a clear legal opinion if payment in rubles is a violation of sanctions,” said Italy’s Prime Minister Mario Draghi on Monday.

The EU remains the top destination for U.S. exports of liquefied natural gas, meanwhile. For the fifth month in a row, Europe took in more than half of U.S. LNG exports globally in April. Total U.S. LNG exports fell slightly during the month mostly on the back of planned maintenance.

With the surge of imports of LNG into the EU, the bloc’s stance on long-term fossil fuel import commitments is beginning to change. Previously a staunch opponent to such long-term commitments, the EU is now reconsidering, according to a report by the Wall Street Journal.

“There’s a real potential here for Europe to signal the demand for U.S. LNG and for our U.S. LNG providers to provide that gas to them in the form of long-term contracts,” said National Security Council senior director for climate and energy Melanie Nakagawa, as quoted by the WSJ.

Besides the United States, the European Union is also looking for gas deliveries from Africa, Bloomberg reported yesterday, citing a draft EU document. Nigeria, Angola, and Senegal are among the countries with solid LNG export potential, according to the document

By Irina Slav for Oilprice.com

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(edited)

On Tuesday 5/3/2022 , US natural gas futures extended gains above $7.9 per million British thermal units [It kissed $8.15] , approaching an over thirteen-year high of $8.197 hit on April 18th, amid lingering output concerns, tight inventories, and elevated demand in Europe. Maintenance-related issues continued to drive volatility in production levels, which is dampening efforts by utilities to refill natural gas stocks. US storage levels entered the refill season roughly 17% below the 5-year average on late wintry weather and strong demand overseas. Since the start of the war in Ukraine, US natural gas prices skyrocketed 50%, as European countries try to substitute Russian natural gas, which has kept LNG exports running near record levels. .

https://tradingeconomics.com/commodity/natural-gas

Edited by Tom Nolan

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https://finance.yahoo.com/news/natgas-futures-top-8-first-093758317.html

Natgas Futures Top $8 for First Time Since 2008 as Weather Adds to Existing Woes

By Geoffrey Smith

Investing.com -- U.S. natural gas futures hit their highest level since 2008 on Tuesday, as an unseasonable spell of cold weather across the northeast and Great Lakes added to longer-term structural factors that have driven prices higher in recent weeks.

The front-month June natgas contract rose above $8 per million British thermal units before retracing some of its gains later to trade at $7.9805 per mmBtu by 9:35 AM ET (1335 GMT), up 6.8% on the day.

The cold snap comes at a time when gas in storage in the U.S. is already below its usual low point at the end of the winter heating season. Traders had already pushed prices higher in anticipation of utilities chasing supplies to bring storage levels back up to the seasonal average

Prices have risen 50% since late February, squeezed higher by demand from electricity generators and from the export market for LNG, which has tightened sharply since Russia’s invasion of Ukraine.

The LNG market is set to remain tight due to European Union countries’ scramble to find substitutes for Russian gas this summer, ahead of the next winter heating season. Russia has already cut supplies to Poland and Bulgaria for their refusal to pay for deliveries in rubles, in what was widely interpreted as a warning to state-owned monopoly Gazprom's bigger European customers in Germany and Italy.

As such, gas is increasingly being sucked out of the U.S. by high global prices through new facilities such as the Calcasieu Pass LNG export terminal in Louisiana, which received formal approval to commission six new liquefaction blocks this week. The terminal is taking 800 million cubic feet of gas a day at present.

Also adding to the pressure on prices is the dwindling availability of domestic pipeline capacity, due to underinvestment in new pipelines in recent years, with repeated project cancellations now crimping output growth in the key Appalachian shale basin.

The $8 billion Atlantic Coast pipeline was canceled two years ago on cost grounds while Equitrans Midstream’s Mountain Valley pipeline from West Virginia to Virginia has been held up by legal disputes, mainly on environmental concerns. It’s not expected to enter service before next year.

Analysts at Bank of America argued in a recent note that there will be "little to no production growth" until new pipes are commissioned.

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https://finance.yahoo.com/news/u-lng-deals-surge-30-180710756.html

U.S. LNG Deals Surge With 30% of Planned Export Capacity Sold

(Bloomberg) -- About 30% of planned U.S. LNG export capacity has been booked since war disrupted European energy supplies, a dramatic reversal of fortune for as many as 10 new projects stymied by a lack of financing.

Energy Transfer LP on Tuesday announced an 18-year supply deal with South Korea’s SK Gas Trading LLC in the latest sign that its long-stalled Lake Charles LNG terminal is gaining momentum. A day earlier, Energy Transfer inked a 20-year contract with Gunvor Group Ltd while French utility Engie SA locked in nearly 2 million tons of LNG from NextDecade Corp.’s proposed plant.

 

Low winter inventories and record high natural gas prices in Europe already had two-thirds of U.S. LNG cargoes heading to Europe before Vladimir Putin’s invasion of Ukraine. The war pushed Europe to ease dependence on Russia and expand port infrastructure to take in more LNG tankers. Meanwhile, U.S. President Joe Biden has pledged to send an additional 15 billion cubic meters of natural gas to Europe by the end of the year.

Since then, prospects have improved for about a dozen of U.S. LNG projects that held federal permits but lacked supply deals and funds to move forward. Long-term purchasing agreements are critical to securing financing for the multi-billion-dollar projects, demonstrating market demand for the final product and ensuring that lenders will be repaid.

As European buyers have become more active, China and other Asian customers have emerged as the largest long-term buyers of U.S. LNG as part of a strategic move to secure supplies and prevent a bidding war between the two continents over the every last molecule available on the spot market.

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https://www.fxempire.com/forecasts/article/natgas-supported-by-worries-over-us-ability-to-build-storage-supplies-988686

James Hyerczyk

May 4th am

NatGas Supported by Worries Over US Ability to Build Storage Supplies

With demand for U.S. LNG steady, all it is going to take is a hot summer and a jump in cooling demand to drive the market into multi-year highs.

NatGas-Pipeline-5.jpg?func=cover&q=70&wi

 

Natural gas futures are edging lower early Wednesday after rocketing higher the previous session amid a combination of bullish factors including “warmer weather patterns, the potential for robust summer cooling demand and vulnerable storage levels,” Natural Gas Intelligence (NGI) reported.

The U.S. market jumped more than 8% on Tuesday, edging closer to a more than 13-year peak hit last month. Besides the factors reported by NGI, buyers were also encouraged by increased demand for U.S. liquefied natural gas (LNG) exports.

At 06:05 GMT, June natural gas futures are trading $7.867, down $0.087 or -1.09%. On Tuesday, the United States Natural Gas Fund (UNG) settled at $26.80, up $0.80 or +3.08%.

Increasing Foreign Demand Fueling Worries about Reducing US Storage Deficit

The U.S. gas market remains mostly shielded from much higher global prices because the United States is the world’s top gas producer, with all the fuel it needs for domestic use while capacity constraints inhibit exports of more LNG no matter how high global prices rise, according to Reuters.

“With any increase in production going forward likely to find its way into the more financially attractive export trade, the ability to reduce a 300+ bcf U.S. deficit anytime soon will keep this market well supported,” advisory firm Ritterbusch and Associates said in a note.

More Sanctions against Russia will Increase Demand for US Gas

The European Union (EU) is preparing sanctions on Russian energy, with possible exemptions for some countries, and warned that complying in full with Moscow’s proposed scheme to receive gas payments in roubles would breach existing EU sanctions, according to Reuters. Meanwhile, the U.S. is going to be expected to cover any short-falls in Europe.

“While domestic demand does not seem to be too much out of line with normal conditions, it is the international pull of gas away from the U.S. that concerns the market,” said Zhen Zhu, managing consultant at C.H. Guernsey and Co in Oklahoma City.

“There will be more demand from the international market especially the European and Asian markets. This increased demand is not expected to be just transitory.”

Short-Term Outlook

With a solid foundation in place because of the steady demand for U.S. LNG, all it is going to take is a hot summer and a jump in cooling demand to drive the market into multi-year highs throughout the year.

From now until the end of June, all eyes will be on the U.S. weekly storage report. Seasonally, we should start to see triple-digit injections. Falling short of these expectations will be another bullish catalyst that launches prices sharply higher.

For a look at all of today’s economic events, check out our economic calendar.

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David Becker Tuesday May 3rd  https://www.fxempire.com/forecasts/article/natural-gas-prices-hit-fresh-13-year-high-988312

Natural Gas Prices Hit Fresh 13-year High

Key Insights

  • Natural gas prices hit a 13-year high.
  • The weather is expected to be mixed.
  • Natural gas LNG exports slid.

On Tuesday, natural gas prices surged higher but settled off the season’s highs. The weather is expected to be mixed, colder on the West Coast and warmer on the East Coast for the next 2-weeks. LNG exports declined in the latest week, but natural gas arrivals at LNG export terminals continued to remain steady.

U.S. LNG exports decrease by three vessels this week from last week. Twenty-three LNG vessels, nine from Sabine Pass, five from Freeport, four from Corpus Christi, three from Cameron, and one each from Cove Point and Calcasieu Pass, combined LNG-carrying capacity of 84 Bcf departed the United States between April 21 and April 27.

Technical Analysis

On Monday, natural gas prices rose higher, hitting a new 13-year intra-day high. Support is seen near the 20-day moving average at 6.9. Target resistance is seen near the May highs at 8.16. The pattern looks like a cup-and-handle, a continuation pattern that follows the trend.

Medium-term momentum has turned positive. The MACD (moving average convergence divergence) generated a crossover buy signal. The MACD histogram is printing in positive territory with an upward sloping trajectory which points to higher prices. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal.

[CHART larger embedded]

ng-050322.jpg?func=cover&q=70&width=700

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https://oilprice.com/Energy/Energy-General/Will-Europes-Desire-For-LNG-Derail-Its-Climate-Goals.html

Will Europe’s Desire For LNG Derail Its Climate Goals?

By Tsvetana Paraskova - May 04, 2022, 4:00 PM CDT

  • Europe’s rush to diversify its gas deliveries away from Russia has resulted in an influx of new LNG imports from the United States.
  • Some environmentalists fear that the ramp up in LNG imports could negatively impact Europe’s climate goals.
  • Despite its new appetite for American LNG, the European Union is committed to its renewable energy initiatives. 

Europe is racing to procure as much non-Russian gas as possible following its irreversible decision to break free from Russian dependence by the end of this decade.  The race to get alternative gas supply has become a rush to import LNG at a record pace, with plans for new import terminals to accommodate the expected high volumes of the super-chilled fuel for years to come.  

Europe’s LNG rush to diversify gas deliveries away from Russia – which is already using gas as a weapon after cutting off supply to Poland and Bulgaria last week – has drawn criticism from climate campaigners. Environmentalists argue that Europe doesn’t need new LNG import infrastructure and should displace Russian gas with renewable energy instead of more gas, to avoid derailing its climate goals of becoming carbon neutral by 2050, after significantly cutting emissions by 2030. 

Still, Europe will need more gas, not only by 2030 but even after that, considering that current technology to use biofuels and hydrogen in hard-to-abate industry sectors doesn’t allow it – yet – to ditch natural gas, says Lukas Trakimavi?ius from the research and lessons learned division of the NATO Energy Security Centre of Excellence. 

Moreover, many countries, including the UK, Germany, and the Netherlands, use a lot of natural gas for heating. 

“It is wrong to assume that, by developing new LNG receiving infrastructure, European governments are abandoning their carbon neutrality plans,” Trakimavi?ius, who has previously worked at NATO and the Lithuanian Ministry of Foreign Affairs, writes in an opinion piece in EURACTIV. 

Europe is seeking to diversify its gas supply, but it is also betting big on renewables to reduce its overall use of gas in the medium to long term. EU officials say that the Russian invasion of Ukraine is yet another clear signal that Europe should accelerate its clean energy rollout. 

“Putin's war in Ukraine demonstrates the urgency of accelerating our clean energy transition,” European Commission Executive Vice-President for the European Green Deal, Frans Timmermans, said in March when the EU presented its plan to become independent from Russian gas by 2030 and cut reliance on Putin by two-thirds by the end of this year alone. 

After the United States and the EU announced at end-March a deal to boost U.S. LNG deliveries to Europe, Jake Schmidt, senior strategic director for international climate at the Natural Resources Defense Council (NRDC) said:

“Instead of supporting further LNG development—which is inconsistent with the world’s climate goals—the U.S. and Europe should ramp up investments in cleaner, smarter and safer ways to power our future.” 

Related: The U.S. Shale Patch Is Facing A Plethora Of Problems

Europe is not abandoning its clean energy goals, on the contrary, it aims to accelerate renewable energy take-up. However, solar and wind should be backed by gas-fired baseload capacity during cloudy windless days, while gas is currently powering many energy-intensive industries that cannot run on renewables, including steel making, fertilizers, or petrochemicals.

Therefore, natural gas will be needed for years in Europe, and LNG is currently its best alternative to replace as much Russian gas as soon as possible, along with increased pipeline imports from Norway or Algeria.

The surge in LNG imports in recent months has had LNG terminals in Europe maxed out, limiting how many cargoes the continent can import now before planned new import and regasification terminals can be built and brought online. European countries have already started planning more terminals, intent on becoming independent from Russian supply this decade. 

Germany plans to build two LNG import facilities; one at Brunsbuettel and one at Wilhelmshaven. Currently, Germany doesn’t have any LNG import terminals. Europe’s biggest economy, which until two months ago had only sporadically thought of LNG import terminals and imports, now seeks a long-term deal with one of the world’s top LNG exporters, Qatar.  

Just yesterday, the leaders of Greece and Bulgaria launched the construction of an LNG import terminal near the northern Greek port of Alexandroupolis, aimed at diversifying supply to southeast Europe and cutting its heavy reliance on Russian gas. 

Europe’s short and medium-term thirst for LNG is good news for U.S. export developers, but it may not be a key driver for American LNG projects beyond 2030, analysts say. 

“A European customer might want gas in 2025 or 2030, but not in 2040 and likely not by 2045. This mismatch prevents U.S. LNG projects from moving forward with European help,” Nikos Tsafos, a James R. Schlesinger Chair in Energy and Geopolitics at the Center for Strategic and International Studies, wrote in early March. 

Europe wants a lot of non-Russian gas now, but, ideally, it wants to not want an increased gas supply a decade or two from now.  

By Tsvetana Paraskova for Oilprice.com

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Wednesday May 4th - Fed announcement day of 50 basis points...

US natural gas futures hit an over thirteen-year high of $8.46 per million British thermal units, as forecasts pointed to likely record early-season heat, exacerbating concerns over tight supplies. The US south-central region is set for temperatures in May that would even be considered hotter-than-normal during summer months, while production remained sluggish amid the maintenance season. The effects combined could offset efforts by utilities to inject natural gas into underground storage and widen the roughly 17% gap between current inventory levels and the 5-year average. Elsewhere, natural gas prices in the US have surged 50% since the war in Ukraine started, as export facilities have been running at near record levels to supply Europe with LNG as the region tries to wean off Russian supplies.

https://tradingeconomics.com/commodity/natural-gas

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America’s LNG Giant Cheniere Reports Unexpected Loss

By Charles Kennedy - May 04, 2022, 2:00 PM CDT

Houston-based Cheniere Energy Inc reported an unexpected Q1 loss, but bumped its full-year profit forecast by 17% in its earnings release Wednesday, on the back of soaring LNG demand and natural gas prices.

The largest LNG exporter in the United States, Cheniere reported earnings up to $8.7 billion before interest, taxes, depreciation and amortization. That represents a $1.2-billion increase over analyst estimates from Bloomberg.

“Today we are raising our 2022 financial guidance due to the sustained strength in the global LNG market and an increase in expected LNG production,” CEO Jack Fusco said. “The current volatility in the global energy markets signals the need for additional investment in new LNG capacity, underscoring the power of the Cheniere platform.”

Despite the stellar guidance, Cheniere’s reported a net loss of $865 million ($3.41 per share) for the quarter, compared with a profit of $393 million ($1.54 per share) in the same period a year ago.

Analysts had been expecting the reverse–earnings of $3.51/share.  [ARTICLE continues]

https://oilprice.com/Latest-Energy-News/World-News/Americas-LNG-Giant-Cheniere-Reports-Unexpected-Loss.html

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Norway Plans Record Gas Volumes For Europe

By Charles Kennedy - May 04, 2022, 12:00 PM CDT

As Europe moves closer to a ban on Russian oil, the voices to replace Russian gas continue to grow louder, with Norway’s Gassco pipeline operator saying on Wednesday that it could end up exporting a record 117 billion cubic meters to Europe in 2022, Reuters reports. 

Gassco has not hit numbers like that since 2017. ...

https://oilprice.com/Latest-Energy-News/World-News/Norway-Plans-Record-Gas-Volumes-For-Europe.html

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Thursday May 5th - midday -  US natural gas futures hit a near fourteen-year high of $8.65 per million British thermal units, as forecasts pointed to likely record early-season heat, exacerbating concerns over tight supplies. The US is set for temperatures in May that would even be considered hotter-than-normal during summer months, while production remained 2 billion cubic feet below this year’s highs amid the maintenance season and recent freeze-offs. At the same time, export facilities have been running at near record levels to supply Europe with LNG as the region tries to wean off Russian supplies. The combination of late wintry weather, soaring overseas demand and insufficient supplies is offsetting efforts by utilities to inject natural gas into underground storage, which currently sit 17% below the 5-year average.

https://tradingeconomics.com/commodity/natural-gas

 

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India Ramps Up LNG Imports Amid Power Crunch

By Irina Slav - May 05, 2022, 7:30 AM CDT

Despite exorbitant prices, India has been buying additional cargoes of liquefied natural gas to battle a power supply crunch that has caused blackouts in one of the world’s most populous countries.

At least two Indian utilities bought LNG cargoes on the spot market this week, for same-month delivery, at prices about three times higher than the normal for spot markets amid tightening global gas supply, Bloomberg reports, citing unnamed sources.

Natural gas only represents a tiny portion of India’s power generation mix; however, a persistent and substantial shortage of coal has forced utilities to switch to gas amid record-high temperatures that have pushed demand higher.

The shortage of coal, which is used to generate more than two-thirds of India’s electricity, emerged earlier this year, eventually leading to planned blackouts as the country entered peak demand season. The roots of the coal shortage, however, date further back when utilities failed to stock up sufficiently before the start of summer on the subcontinent.

Last year, analysts warning about a looming coal shortage in the country said that it could last for three to six months. The shortage was the result of the fast and sharp rebound in demand for electricity after the COVID lockdowns combined with supply chain snags that have plagued utilities around the world.

India is producing coal at a record rate amid the shortage, with some forecasters expecting total output of some 800 million tons in the financial year that started last month, the Financial Times reported this week.

The global LNG market is also getting tighter amid ever-growing demand from the European Union, which is in a rush to fill its storage space for next heating season and insulate itself as much as it can in case Russia turns the gas tap off for more European countries after Poland and Bulgaria.

By Irina Slav for Oilprice.com

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https://oilprice.com/Latest-Energy-News/World-News/India-Ramps-Up-LNG-Imports-Amid-Power-Crunch.html

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Piotr Berman    + 82

Piotr Berman

The price of NG in Europe (Dutch trading) is about 30 (Euros?) per MWh, and in USA (Henry Hub?), 8 2/3 USD per MM BTU.  This means (if I use converter correctly), ca. 29 USD per MWh.  Seems that at this moment, buying in USA, liquifying, transporting, gasifying and selling would make you loose.  It can be different with long term contracts on either side of Atlantic.

Nevertheless, inflexible US demand and export seem to be at equilibrium, so if I did math correctly, further increasing of LNG export requires demand destruction in USA

 

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4 hours ago, Piotr Berman said:

The price of NG in Europe (Dutch trading) is about 30 (Euros?) per MWh, and in USA (Henry Hub?), 8 2/3 USD per MM BTU.  This means (if I use converter correctly), ca. 29 USD per MWh.  Seems that at this moment, buying in USA, liquifying, transporting, gasifying and selling would make you loose.  It can be different with long term contracts on either side of Atlantic.

Nevertheless, inflexible US demand and export seem to be at equilibrium, so if I did math correctly, further increasing of LNG export requires demand destruction in USA

 

I suck at math, but I think you got the 30 Euros from a source that may not be correct.

Here is Thursday May 5th

EU natural gas futures rose for the third straight session to €105 per megawatt-hour, supported by lower renewable energy generation, adding to the bullish support from the EU’s proposal of an import ban on Russian crude and refined petroleum products. The bloc’s sixth round of sanctions will ban imports of refined products by the end of the year and cut crude oil purchases within six months, which could boost demand for natural gas in the energy sector. It adds risks to a market filled with concerns over the Kremlin’s payments demand, after Gazprom halted supplies to Poland and Bulgaria, while several utilities have yet to open accounts in rubles in fear of breaching EU sanctions. Additionally, Norwegian natural gas supplies slipped from the previous day amid lingering maintenance works. Preventing a stronger rally, seasonally warmer weather dampened demand, while arrivals of LNG cargoes remained elevated.

https://tradingeconomics.com/commodity/eu-natural-gas

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Piotr Berman    + 82

Piotr Berman

(edited)

1 hour ago, Tom Nolan said:

I suck at math, but I think you got the 30 Euros from a source that may not be correct.

Here is Thursday May 5th

EU natural gas futures rose for the third straight session to €105 per megawatt-hour, 

https://tradingeconomics.com/commodity/eu-natural-gas

My source is OilPrice, but it is hard to figure out units for prices.  Perhaps Dutch prices have the same unit as American, so 30 Euros translates to 100 Euros per kWh, giving generous markup from 30 USD at Henry Hub (??).  This leaves ca. 80 USD (assuming that 100 Euroes equal 110 dollars, may be incorrect at this time) to pay for 

a. liquifying

b. transporting (LNG carriers are quite a bit more expensive than crude carriers)

c. gasification

d. breaking hedges, i.e. promises to buy NG for some price, now that the price is higher, those promises are not needed but they were paid for (another Oil Price article).

Does it mean that the invisible hand of market can double American NG prices once more?   New liquifying facilities take few years to build, at cost at least 10 billion USD each (I guess, I watch on YouTube a video about a Russian project for 20 billion.   Should US Administration encourage such expansion and the resulting doubling of already tripled domestic NG prices?

BTW, there is a wide variety of units for NG prices, perhaps one should also quote prices per bushel or per Piotr (the amount Piotr uses in an average year), seriously it is bewildering.  For example, Europeans are converted old metrics to new metrics, MWh is actually 3.6 GJ, prices could express the heat value or projected gross electricity (generation) or net electricity (generation and transmission) and so on.

 

Edited by Piotr Berman
adding to the post

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EU Policy Chiefs Warn Against Creating New LNG Dependence

Tyler Durden's Photo
by Tyler Durden
Friday, May 06, 2022 - 05:30 AM

Authored by Irina Slav via OilPrice.com,

The European Union is replacing one form of fossil fuel dependence with another, a group of former Brussels policy chiefs warned in a letter, cited by Reuters today.

"Simply diversifying the import of fossil fuels will only serve to maintain EU energy dependence on other countries, many of which do not respect EU values," the authors said.

https://www.zerohedge.com/energy/eu-policy-chiefs-warn-against-creating-new-lng-dependence

Latest articles from Irina Slav

 

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Europe Is Buying Natural Gas At A Premium To Fill Up Its Storage

https://oilprice.com/Energy/Natural-Gas/Europe-Is-Buying-Natural-Gas-At-A-Premium-To-Fill-Up-Its-Storage.html

By Irina Slav - May 05, 2022, 6:00 PM CDT

  • Lower natural gas consumption has helped Europe stock up the commodity.
  • Europe is paying a premium for natural gas as importers refuse to pay for Russian gas in rubles.
  • American LNG has been a lifeline for European importers, but some worry that the region could trade its dependency for Russian gas for a dependency on U.S. LNG.

Prohibitively high natural gas prices in Europe have helped the continent stock up on the commodity amid lower consumption, simultaneously motivating more imports, Reuters’ John Kemp reported, meaning Europe might get its storage caverns full before the next heating season begins. That inventories are filling up faster than previously expected is a rare instance of good news for the European Union, which has been struggling with high energy prices for more than six months now. The more important question, however, is precisely the one about prices. Storage may be full, but would the gas it holds be more affordable for European consumers?

The answer is unlikely to be positive. The EU is buying natural gas at a premium because of its urgent need to fill those caverns before either winter comes or Russia turns the gas taps off because importers are refusing to pay in rubles.

The suspension of deliveries to Bulgaria and Poland appears to have spurred European importers into action: Earlier this month, requests for Russian gas deliveries to Europe hit a five-month high. LNG imports are also going strong even though total U.S. shipments abroad are on the decline due to regular maintenance at liquefaction facilities on the Gulf Coast.

According to Reuters’ Kemp, at the start of May, natural gas inventory levels in Europe were 18% below the five-year average from before the pandemic. This translated into 81 TWh. As of the start of this month, the amount of gas in storage in the EU and the UK has grown to 380 TWh. At this rate, Kemp said, gas in storage could reach 904 TWh by October 1 when heating season begins.

There is an “if” here, however. This rate can be maintained if there is sufficient gas supply from different sources and if, of course, Russia continues to supply gas to its European buyers. This, in turn, will happen if they agree to pay for Russian gas in rubles. In other words, it might look like the EU is holding the reins, but it’s not doing it alone.

Then there is the question of prices. Businesses and consumers across the EU are already struggling with their electricity bills. Businesses in some parts of the union, such as Bulgaria, are warning about imminent bankruptcies because of excessive energy costs. 

Now, if the EU is buying up natural gas at “exceptionally high prices”, as Kemp puts it, what prices would it be selling this to those that consume it? It would be quite bold to assume that governments will shoulder most of the exceptional price to make the gas affordable for everyone. 

Related: OPEC+ Agrees To Boost Production By 432,000 Bpd In June

The very fact that one big reason for the faster-than-usual filling up of inventories is because of subdued consumption due to elevated prices should be cause for concern already. It means that gas is simply too expensive to use. And this is not a good thing for the European economies.

Meanwhile, there are calls for further reduction in the consumption of gas, too. A German research institute this week called on Germans to curb their gas consumption in case Russia suspends deliveries to Europe’s largest consumer and importer.

According to the researchers from EWI, if Russia suspends gas flows now, the EU—excluding Spain and Portugal—and the UK, together, would need to cut gas consumption by 459 TWh during the summer. But if that region seeks to maintain a 33% level of gas inventories to total capacity, then it would have to cut consumption by as much as 790 TWh. 

In other words, even as it seeks to shake off its dependence on Russia, the EU remains very much dependent on it. At the same time, it is developing a new dependence on U.S. liquefied natural gas, as Europe has remained the top destination for U.S. LNG for five months in a row. But U.S. LNG capacity is not endless and that may become a problem down the road. 

By Irina Slav for Oilprice.com

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https://oilprice.com/Energy/Natural-Gas/Finland-Braces-For-Russian-Gas-Cut-Off-Ahead-Of-NATO-Decision.html

Finland Braces For Russian Gas Cut-Off Ahead Of NATO Decision

By Tsvetana Paraskova - May 05, 2022, 3:00 PM CDT

  • Finland could become the next country to which Russia may cut off gas supplies.
  • Finland is expected to decide within weeks whether to apply to join NATO.
  • The Scandinavian country has refused to pay in rubles for Russian gas.

Finland is prepared that it could be next on Russia’s list for cutting off gas deliveries for European Union members, as the Russian neighbor to northwest is expected to decide within weeks whether to apply to join NATO.  “Finland is prepared for the possibility that gas deliveries from Russia would end,” Finnish Minister of European Affairs Tytti Tuppurainen told Reuters on Thursday.

Russia has already halted natural gas supply to two EU members as it insists customers start paying in rubles for its gas. Last week, Gazprom stopped gas deliveries to Poland and Bulgaria, saying supply was cut off “due to absence of payments in rubles.”

Finland has refused to pay in rubles, which could result in its Russian supply being cut off, all the more so that Russia has warned Finland, as well as Sweden, against applying to join NATO. 

The Russian invasion of Ukraine pushed the previously relatively neutral EU members Finland and Sweden to consider joining the Western military alliance. Russia, for its part, has cited NATO expanding to its borders as a reason to consider it a threat to its interests. 

Related: Germany Will Have First LNG Import Capacity By Year’s End

Both Finland and Sweden are expected to decide whether to apply for NATO membership in the coming weeks. 

Meanwhile, a Russian army helicopter violated Finland’s airspace on Wednesday, a spokesperson for the Finnish defense ministry told AFP.

In the interim, NATO announced on Thursday that it would provide extra security and increase its presence in the Baltic Sea while the fate of Finland and Sweden’s NATO membership is being decided. 

Finland gets up to 70 percent of the gas it uses from Russia, although gas doesn’t have a large share in the overall energy mix. 

Getting ready to be cut off from Russian gas, Finland has been preparing to use alternative energy sources. Last month, the Government’s Ministerial Committee on Economic Policy recommended that Finland lease a large liquefied natural gas (LNG) terminal ship in cooperation with Estonia.  

“As a result of the war in Ukraine, we must also be prepared for gas imports to stop. A floating LNG terminal is an effective way to secure the gas supply for our industry,” Economic Affairs Minister Mika Lintilä said in April. 

By Tsvetana Paraskova for Oilprice.com

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https://oilprice.com/Latest-Energy-News/World-News/Germany-Will-Have-First-LNG-Import-Capacity-By-Years-End.html

Germany Will Have First LNG Import Capacity By Year’s End

By Charles Kennedy - May 05, 2022, 12:30 PM CDT

Germany has begun construction on its first LNG import terminal, and in the meantime, has rented four mobile floating tankers as it scrambles to rid itself of the need for Russian natural gas. 

Construction of the LNG import terminal has been fast-tracked, with German Economics Minister Robert Habeck hoping to complete this at “Tesla speed”, in less than a year.  

The terminal is being built in Wilhelmshaven on the German North Sea, and officials are aiming to see the first LNG tankers dock at it by the end of this year. Additional LNG import terminals are being planned in two other regions. The terminals will receive LNG from the United States and the Middle East as Germany vows to replace Russian gas at lightning speed in the wake of a Wednesday proposal by the European Union for a full ban on Russian oil.

“We have a good chance of achieving something that is actually impossible in Germany: to build an LNG terminal within about ten months and to connect it to the German gas supply,” Habeck said, as reported by Deutschland.de. 

But the first LNG to Germany will arrive via four newly chartered FRSUs.

Also on Thursday, German officials announced they had chartered four FSRUs–Floating Storage and Regasification Units–to regasify large volumes of LNG at deep water ports, Euractiv reports. 

Related: OPEC+ Agrees To Boost Production By 432,000 Bpd In June

According to Euractiv, the first chartered FSRU, from Norway, will be in Wilhelmshaven and be operational before the end of the year, with an annual capacity of 5 billion cubic meters. 

A second FSRU, also from Norway, will be online by early next year. 

Two additional FSRUs, both from Greece, will follow. 

In total, Germany is hoping to build up a regasification capacity with the four charters of around 20 BCM per year, approximately half of its Russian gas import volume. Combined, all of Germany’s LNG project plans foresee a total import capacity of 68 BCM, surpassing the amount of Russian gas generally piped into the country. 

Several weeks ago, Germany released some 3 billion euros for LNG mobile terminal charters.

Germany’s Energy Ministry is hoping to declare the country completely independent from Russian oil within a matter of weeks, replacing supplies and rerouting them through the German Baltic Sea port of Rostock and the Polish port of Gdansk. 

By Charles Kennedy for Oilprice.com

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https://www.fxempire.com/forecasts/article/june-natural-gas-looking-to-extend-explosive-rally-on-breakout-over-9-010-991814

Published: May 6, 2022
June Natural Gas Looking to Extend Explosive Rally on Breakout Over $9.010
Trader reaction to $8.783 will determine the direction of the June natural gas market on Friday.

Natural gas futures are trading flat early Friday with the nearby futures contract hovering just under a more than eight year high. One catalyst behind the current surge is waning U.S. production growth at the same time many countries are looking for new suppliers to help break their dependence on Russian gas after Moscow’s invasion of Ukraine.

At 07:08 GMT, June natural gas futures are trading $8.793, up $0.010 or +0.11%. On Thursday, the United States Natural Gas Fund ETF (UNG) is at $30.08, up $1.07 or +3.69%.

The United States is already the world’s largest producer of natural gas. But the two mainstays of production – the Appalachian region and West Texas – are seeing growth slow, with companies blaming lack of adequate pipeline infrastructure, despite prices near 14-year highs, according to Reuters.

Since Moscow invaded Ukraine on February 24, U.S. gas prices have soared about 50% as European countries look to the United States, the world’s second biggest exporter, to sell more liquefied natural gas (LNG) to wean Europe off Russian fuel, Reuters said.

Daily-June-Natural-Gas-1.jpg?func=cover&

 

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. Taking out yesterday’s high at $8.913 will signal a resumption of the uptrend. A move through the November 10, 2014 main top will reaffirm the uptrend. A trade through $6.805 will change the main trend to down.

The minor range is $6.805 to $8.913. Its 50% level at $7.859 is the nearest 50% level and potential support.

Daily Swing Chart Technical Forecast

Trader reaction to $8.783 will determine the direction of the June natural gas market on Friday.

Bullish Scenario

A sustained move over $8.783 will indicate the presence of buyers. This could trigger a surge into the main top at $9.010. This level is a potential trigger point for an acceleration into the June 16, 2014 main top at $9.551.

Bearish Scenario

A sustained move under $8.783 will signal the presence of sellers. If this move creates enough downside momentum over the short-term, we could see a test of the first pivot at $7.859. Since the main trend is up, buyers are likely to come in on a test of this level. Aggressive traders have been buying dips for months and I don’t see them letting up since the fundamentals are skewed to the bullish side.

Side Notes

Taking out $8.913 then closing lower for the session will form a potentially bearish closing price reversal top. If confirmed, this could trigger the start of a 2 to 3 day correction.

For a look at all of today’s economic events, check out our economic calendar.

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