LNG: Gas Continues Range Trading As Winter Season Approaches
Gas prices were little changed on Wednesday as Europe continues to range trade and the US held onto this week’s gains driven by a cold snap. Both remain vulnerable to colder-than-average winter weather.
- Henry Hub is up 5% this week driven by cold weather across the US east. It stabilised on Wednesday falling 0.7% to $4.532 but traded in a narrow range of $4.461/4.582. It is now around 10% higher this month and flashing overbought.
- EIA reports gas inventories for last week on Thursday. Bloomberg consensus expects a 34 bcf injection, just below the 5-year average of 35 bcf. Storage is around 4.3% above 5-year average, according to Bloomberg.
- European gas was down 0.4% to EUR 30.965 trading between EUR 30.765 and 31.580. The lack of direction is reflected by steady prices in November. The market is waiting for clarity on the outlook for winter and is stable while LNG imports remain strong, helped by soft Asian consumption, but remains vulnerable to any supply disruptions.
- Forecasts for next week are signalling a drop in temperatures while models are signalling a cold winter for Northern Europe, according to Bloomberg.
- While Chevron sees lower oil prices in 2026 due to higher supply, it doesn’t think LNG will be pressured by higher output from the Middle East until closer to 2030. It is forecasting demand to continue to trend higher.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
JGBS: Focus On Whether Futures Bounce Can Be Sustained As Onshore Returns
JGB futures finished up at 136.42, +.52 versus settlement levels. Prices surged Monday, in sympathy with global bond markets, helping the price rally toward last week’s high. Sentiment was buoyed by the flight to bond markets, although with equity sentiment stabilizing focus will be on whether this is sustained. We will need to challenge resistance before signaling a broader reversal. Key short-term resistance has been defined at 137.30, the Sep 8 high. The latest sell-off, however, resulted in a break of support at 136.19, the Sep 4 low and a bear trigger. Clearance of this level confirms a resumption of the downtrend and opens 135.39 next, a Fibonacci projection.
- Cash JGBs finished up last Friday at 1.69% for the 10yr (just off cycle highs), while the 2/30s curve was at +228bps, slightly steeper.
- Japan markets return today. Politics remains a focus point, with opposition parties set to meet today to discuss the collapse of the governing coalition last week. These meetings could help determine whether Takaichi goes ahead with a minority government, or looks to bring forward elections. Her odds of becoming the next PM have slid to 77, per Polymarket (down from post LDP leadership election highs near 100).
- Locally on the data front Sep money stock figures, not typically a market mover.
- Note tomorrow we have a 20yr debt auction.
NZD: Kiwi Lower Following RBNZ LVR Decision, Economy Continues To Need Support
NZDUSD declined to 0.5721 following news that the RBNZ would increase the share of loans with an LVR above 80% from 1 December, an easing of financial conditions. The pair is currently trading slightly above that level. It was around 0.5728 before the news after dipping briefing on data showing a contraction in retail spending in September.
- Kiwi was one of the better G10 performers on Monday with NZDUSD slightly higher at 0.5725 off the intraday low of 0.5719.
- September retail card transactions fell 0.5% m/m after rising 0.6%, the first negative after three consecutive increases. Annual growth slowed to 1.2%. Despite the soft end to Q3, the quarter saw a 0.6% q/q increase in nominal retail spending. Q3 retail sales volumes are released 27 November. They rose 0.5% q/q & 2.3% y/y in Q2.
- Aussie outperformed on Monday leaving AUDNZD up 0.6% to 1.1379 after reaching 1.1384 with the pair partially regaining some of Friday’s losses. It is currently up 0.1% to 1.1387. With more NZ easing widely expected and not even a full 25bp priced in for Australia by end-2025, AUDNZD could return and even go beyond its post-October RBNZ rate cut highs.
MNI: UK BRC SEP BY VALUE SHOP SALES LFL +2.0% Y/Y, TOTAL +2.3% Y/Y
- MNI: UK BRC SEP BY VALUE SHOP SALES LFL +2.0% Y/Y, TOTAL +2.3% Y/Y
