Is Hotter Weather Enough to Extend the Rally?

Forecast models remain in alignment on increasingly hot conditions for the second half of July, particularly across the eastern two-thirds of the U.S. NatGasWeather noted that the next five days will carry solid demand due to widespread heat, while days 6–15 show a “decisively hotter” outlook.

Temperatures are expected to surge into the 90s along the East Coast and hit triple digits in California and the Southwest, with modest cooling only in the northern third of the country.

These heat-driven forecasts are boosting near-term demand expectations for electricity generation, increasing the call on gas-fired power.

On Wednesday, August Nymex natural gas settled up $0.028 (+0.79%) at a new two-week high. The rally has been fueled by stronger air conditioning load and steady LNG exports, which climbed slightly to 15.1 bcf/day, according to BNEF.

Can Traders Trust the EIA Storage Signal This Week?

Attention is now turning to Thursday’s EIA storage report for the week ended July 11, which is expected to show a +45 bcf injection—above the five-year average of +41 bcf.

However, analysts are treating the print as “tricky,” factoring in distortions from the Fourth of July holiday and weaker wind generation. Last week’s inventory build of +53 bcf was bullish, falling below expectations and aligning with seasonal norms.