Houston — NYMEX October natural gas futures were on the rise Tuesday as the market continued to recover from the aftereffects of Tropical Storm Irma, trading at $3.03/MMBtu as of 11:40 EDT (1540 GMT) up 8 cents from Monday.
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"We're seeing a big jump today," said Daniel Myers, a market analyst with Gelber and Associates. "The market is rebounding after Irma and some bullish sentiment is coming back."
John Woods, president of JJ Woods Associates, agreed the market is on the rise, pointing to demand in the US Southeast.
"There's a lot of people without power, but we're still seeing usage," he said.
According to Platts Analytics' Bentek Energy data, power demand in the Southeast was up 1.8 Bcf to 6.6 Bcf Tuesday. At the same time, the Northeast also saw a demand increase of 1.3 Bcf to 7.8 Bcf
The demand increase, coupled with an overall decline in US dry production to 82.5 Bcf, down 1.4 Bcf on the day, provided positive pressure to the market.
The weather outlook also looks to keep the market on a bullish path.
"The medium-range forecast looks for some warming in the east and the south, so we expect to see some more power demand at the end of [September,]" Myers said.
Woods took a similar view, but said the natural gas market could see another spike.
"You really want the market to be long, because all you need is one weather pattern to change things," he said. "You get an Indian summer where temperatures are up and if the market is short, You're going to see prices in the $3.40s [per MMBtu]
Woods said there is one bit of uncertainty in the market in that Irma's impacts on power generating are still unknown.
"We won't really know what's going on for a couple of days," he said. "The water is receding every day, but we really need to have people be able to get in and see what the real damages are."
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