Energy Cable #43: Price resilience despite warm weather
The heating season is yet to really turn into a heating season and warm temperatures have wreaked slightly havoc with our Nat Gas bet so far. Beneath the surface, the fundamental bullishness is brewing and our models double down on the positivity!
As we have pointed out numerous times natural gas in Europe is largely a temperature play in Europe short-term hence the rise in price over the last few weeks. Now realized and forecasted temperatures have turned and are now pointing towards above mean temperatures in the next weeks as seen by the chart below. This is clearly a downward pressure being put on prices. Especially given storage levels.
Chart 1: Sharpe temperature reversal
The heating season is yet to really turn into a heating season and warm temperatures have wreaked slightly havoc with our Nat Gas bet so far. Beneath the surface, the fundamental bullishness is brewing and our models double down on the positivity!
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