Natural gas futures are under pressure as strong production levels and warmer weather forecasts weigh heavily on the market. As of December 16, 2024, production remains robust at 103.8 billion cubic feet per day, according to Wood Mackenzie, maintaining the oversupply concerns that have been a persistent theme. Weather models have shifted towards warmer trends, reducing the expected heating demand significantly. The GFS model, for instance, has trended 26 heating degree days warmer, indicating a sharp drop in near-term demand. This bearish sentiment is further exacerbated by the fact that the southern U.S. is experiencing mild temperatures, with highs in the 60s-70s, which suppresses natural gas consumption for heating.
The ProShares Ultra Bloomberg Natural Gas ETF (BOIL) is currently priced at $42.40, reflecting a 3.75% decrease from its previous close.