record warmth next week & Which climatic factors caused the collapse in natural gas prices?

record warmth next week & Which climatic factors caused the collapse in natural gas prices?

Please see the video above about what it would take to bring cold winter weather to the energy markets. Something we call the MJO, plus the southern Plains drought, Climate Change, and La Nina will bring record warmth to the east next week and melt any snowman. But how could things change and winter turn cold, if at all? I see some signs that colder late December and early January weather will potentially put a short-term bottom in the natural gas market.

If you are an ETF trader, farmer, or commodity trader from grains too soft commodities such as coffee, natural gas, and more, you owe it to yourself to learn about the power of weather and receive a free issue of Climatelligence. Click below

Why signs of a strong La Nina are breaking the Brazil drought and pressured natural gas prices

Why signs of a strong La Nina are breaking the Brazil drought and pressured natural gas prices

CLICK ON THE VIDEO ABOVE TO HEAR ABOUT LA NINA, SUGAR PRICES, THE EASING OF THE BRAZIL DROUGHT, AND THE BIG WESTERN STORM BY OCT 26TH

LA NINA HAS CAUSED COMMODITY MARKETS FROM NATURAL GAS TO SUGAR AND COCOA TO BRING DOWN THE CRB COMMODITY INDEX

Commodity markets have been in a major bull run for the past year or so inspired by a surge in precious metals such as silver and copper, a rebound in crude oil prices, and a recent soaring natural gas, sugar, coffee, cotton, and wheat market.

La Nina

The record hot U.S. summer is an indication of Climate Change on steroids. The western U.S. drought helped to exacerbate the summer heat and help natural gas prices soar. Why? Hydropower was cut off to the west, and natural gas was the alternative. An active hurricane season in the Gulf and historical tight supplies of natural gas in Europe and Asia have resulted in strong LNG natural gas exports from the U.S.

La Nina

However, over the last two weeks, natural gas prices have fallen sharply inspired by my forecast of a warm late fall and weak demand. Plus, the drought out west will be easing a bit. This will allow electric companies to switch back to hydropower following the historical summer drought. This will not happen right away, and a lot more rain will be needed, but it is a start.

LA NINA GROWING STRONGER means a warm late u.s. fall and easing of the brazil drought

Sometimes weak La Nina events or east-based La Nina Modoki can bring major cold weather to U.S. energy areas. However, as I pointed out to Weather Wealth clients the last few weeks, my expectation is not for an east-based La Nina Modoki but a potentially moderate to strong standard La Nina. What does this mean? Rather than the cool ocean temperatures in the equatorial Pacific being close to Peru, the cold waters will be spread out equally. You combine La Nina with the historical drought out west, and my computer program Climate Predict suggests a warm late fall and early winter. This has caused everyone and their dog to “run for the hills” if they were long natural gas on the hot summer and tight stocks.

La Nina

Stay tuned, however, certain types of stronger La Nina events can in fact bring a cold December or January. So, we do not want you to miss some of the trading opportunities we will have for Weather Wealth clients.

What an average of all la nina events suggest for winter temperatures

Shown below are all La Nina events and the tendency for winter cold to be mainly over parts of Asia, Europe, New England, and much of western Canada. Is this written in stone? Of course not. I am sure there will be some occasional cold periods and trading opportunities in natural gas and heating oil in the months ahead. However, it will be important to monitor what is also happening with Sea Ice over the Arctic, as well as many of the teleconnections (climatic variables) listed in blue, below.

La Nina
La Nina

One of my strongest and successful recommendations to Weather Wealth clients, was selling natural gas in early October, based on my warm October and November forecast. However, prices may have fallen too far too quickly, especially with all of winter still ahead of us.

CLIMATE PREDICT PREDICTED THE EASING OF THE BRAZIL AND WESTERN U.S. DROUGHT

While the media has been touting that La Nina conditions might intensify the Brazil drought, it has really been deforestation in the Amazon that was the main culprit of record low water levels from Parana to Sao Paulo. While some La Nina events can bring droughts to northern Brazil, it is usually southern Brazil and Argentina that have dryness between October-January during La Nina events–not northern Brazil

Warm ocean temperatures in the eastern South Atlantic is called the TSA index. The combination of a moderate to strong La Nina and certain weather conditions over Antarctica called a positive AAO index helped us predict the easing in the northern Brazil drought, more than a month ago. Indeed this past week, that has been happening.

Prices for sugar (for example) have begun to reat negatively to the easing Brazil drought, following a major bull market. La Nina could bring crop problems for corn and soybeans later this year or in early 2022

La Nina

So how do you take advantage of my long-range weather forecast and investing? I invited you to a free issue of CLIMATELLIGENCE:

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What Is The Outlook For Natural Gas Prices In 2020?

What Is The Outlook For Natural Gas Prices In 2020?

Why Jim Roemer Predicted A Warm Winter for Natural Gas Prices Last December

One of our most accurate trade ideas this past season was selling natural gas. That warm winter projection was in our forecast for December. WeatherBell, and many other forecast firms, kept touting cold winter models. In my opinion, they also published erroneous theories that low solar activity is more important than a warming planet. I do acknowledge that I had been in the camp for some cold early winter weather in November. However, I quickly changed that view due to various global teleconnections. Here is an article I wrote a few months ago.

My reasoning for a warm winter outlook was due to teleconnections I predicted: weak El Nino, positive Indian Dipole, etc. You can learn about weather and the teleconnection relationship for FREE

Why Did Natural Gas Prices Suddenly Rally in April?

Over the past few weeks, the pandemic spawned worries about global demand for both crude oil and natural gas. This helped to pressure these energy commodities to new lows, a week ago. I recently highlighted an energy opinion in my WEATHER WEALTH weekly commodity weather blog. In that comment, I stated that lower crude and natgas prices could curtail shale production and possibly boost energy prices. The recent $7/barrel rally in crude futures off the $19 spot contract lows wasn’t based on weather. It is more tied to feelings that OPEC and Russia will have a truce in their oil production war. Longer term, once this pandemic ends, crude prices are likely to sustain a more pronounced rally.

Regarding the weather, an early spring Midwest (and Northeast) cold spell in coming weeks created short covering.

cold

The blue trough shown above is creating some excitement in the natgas market, even though winter is practically over. Nevertheless, New England snows and Plains temps in the teens and 20s next week have created some short covering. In addition to natural gas hedgers/speculators, traders in the wheat market will also be focusing in on this.

cold

Temperatures next Tuesday and Wednesday could actually be colder than this possibly falling into the 20s across even southern Kansas. This will interest wheat market participants who will be closely following what transpires.

Madden–Julian Oscillation

The Polar Vortex break-off is responsible for two bouts of eastern and Midwest cold I expect in the next fortnight. In part, this is due to the MJO.

MJO

The MJO’s cold phase is not the only factor replacing the Polar Vortex to the south. In my opinion, El Nino’s residual effect from last winter, and other teleconnections, caused the near record warm US winter. Now, many of those teleconnections are beginning to change.

What will summer be like? How might you be able to take advantage of the natural gas and grain market? You’ll learn the answers when you sign up for a free trial to my weekly GOLD PLAN blogs.

Jim Roemer

Why standard computer models being cold for US energy areas have not verified. What’s ahead?

Why standard computer models being cold for US energy areas have not verified. What’s ahead?

Those of you who are subscribers have heard me talk about a warm first part of winter for the US for weeks and hence a generally bearish outlook for natural gas prices. Stocks are huge and global weather, not just in Australia has been warmer than normal. Obviously, the situation in Australia is one for the record books and is due to a combination of Climate Change, the positive Indian Dipole and weak El Nino signal. These teleconnections have also affected US weather and has contradicted so many “global warming” deniers who keep pointing to low solar cycles as a reason for a cold winter.

Will things change for US natural gas areas? It all depends on two climatic variables I often look at: 1) Whether the EPO index turns negative (Right now it has been positive). A negative EPO index would build a ridge over Alaska and force cold weather back into the US.

We can see how some models have a negative EPO index heading deeper into January. What is the correlation with the EPO index? Jim Roemer’s unique CLIMATEPREDICT long range weather forecast program (used by many hedge funds, traders and agribusinesses), shows the historical trend and analogs with a negative late January EPO index.

However, at the bottom of this article are my projected analog years that have forecasted any cold US weather being short lived, since early December. This is not bullish for natural gas, even at close to $2.00

The EPO index has to do with the jet-stream over Alaska. If a ridge (red) forms, that means the EPO will go negative. But will it last? After all, we need more than a week or so of cold to really get natural gas prices out of the doldrums.

2) The MJO: Will it go into a colder phase or stay in a warm phase? History says that when the MJO goes into a strong phase 7-1, that this could make the EPO go negative and cause colder weather. A good definition of the MJO is here. You can see the MJO is trending towards the colder phases.

You can subscribe here for free to get an occasional update from Jim Roemer. A subscription based service, that promises to be the best in the industry will be available by spring with many more details regarding multiple commodities.

Finally, every time there has been a short term cold scare by models, it has not lasted due to a lack of US snow cover and also these teleconnections (stars) from our in house program CLIMATE PREDICT. Notice the warm weather that is suggested into early February. This is in contrast to some computer models.

The El Nino signal, global warming and my program (below), illustrate how we have out guessed standard cold computer models, which most meteorologists believe verbatim

BOTTOM LINENatural gas prices are likely NOT finished going down and it would not surprise me if any cold is short lived.

Big Powder For Western Ski Areas Brings Warmth To U.S. & Europe

Big Powder For Western Ski Areas Brings Warmth To U.S. & Europe

I have been discussing weeks for some energy and ski clients, why certain climatological parameters would likely bring warm weather, not only to the main US natural gas and heating oil areas, but also for much of western Europe.

Indeed, we have seen natural gas prices break some 20% over the last few weeks, while heating oil is under pressure versus the rest of the crude complex that has been pumped up by Iran-Iraq-US military tensions.

JET-STREAM FORECAST PREDICTED IN EARLY DECEMBER THROUGH MID-LATE JANUARY,2020

I still look for feet of snow for many western ski resorts the next 2 weeks or so with places like Whistler, Mt. Hood, Big Sky Montana and Jackson Hole getting into the action. The Lake Tahoe region to Utah will also get at least a couple feet of snow. Very cold temperatures will finally lower freezing levels in British Columbia, which was short changed on snowfall through most of December. The colder temperatures mean much higher snow:water equivalent ratios. Hence, some areas out west could see 3-5 feet of snow the next 2 weeks.

The stars and arrows on CLIMATEPREDICT (above) are the climatological variables that we used to predict the mild, early, eastern winter and cold and story out west. They are a negative AAO index, the positive Indian Dipole, responsible for the fires and extreme heat in Indonesia and particularly Australia, and also a warm NINO34, in which El Nino conditions persist in the western Pacific. While El Nino is weak, this is not something NOAA or many other firms are talking about.

In addition, we have the MJO moving into a phase that is favorable for warm eastern weather and cold and snowy out west.

Estimates snowfall through January 22nd. The areas in red represent at least 2-3 feet of snow. However, I believe that some of these areas may see 3-5 feet or more

You can see the jet stream pattern from short term weather forecast models. Again, this is something that CLIMATEPREDICT predicted more than a month ago.

The blue region represents cold temperatures. In fact, parts of the Pacific NW and western Canada will be as much as 15-20 degrees below normal, well into Mid January. The NW flow is ideal for snow in Oregon, British Columbia, Idaho, Washington State and places like Jackson Hole; not just for Tahoe to Utah and Colorado, which saw decent December snowfall.

Jim Roemer

Unique scientific techniques in making winter forecasts for energy markets, skiing and travel

Unique scientific techniques in making winter forecasts for energy markets, skiing and travel

I have received hundreds of requests from around the world for me to start a weekly or monthly long range weather subscription forecast service. This would be “SECOND TO NONE”‘ , given my 35 years experience forecasting for dozens of ski resorts, farmers and some hedge funds and investors. Of course, weather forecasting can be difficult and due to “chaos theory”, “global warming” and “solar activity”, things can change on a dime.

This is why I will be offering such a newsletter in the weeks or months ahead. It will focus on forecasting for many industries from skiing to commodities with some generic trading and investing ideas.

Coming sometime this winter, a new weather newsletter with occasional updates, (WEATHER-WEALTH) So check back frequently for details.

In the meantime, if you email me at subscriptionbestweather@gmail.com I would be happy enough to send you my preliminary winter outlook for 2019-2020.

While many weather forecasters try their hand at these long range predictions, I am lucky enough to also incorporate a special program called CLIMATECH, which I developed with an alum from MIT. It uses teleconnections such as El Nino, ocean temperatures thousands of miles away, what is happening over the North and South Poles, etc. to help make predictions.

IN THIS FREE REPORT I WILL SEND YOU:

*Why late November will feature more cold and snow for the Midwest and East and is putting a floor in natural gas prices and heating oil spreads. What may December be like?

*Low solar activity; El Nino Modoki; Stratospheric Warming; Weather Weirdos, CLIMATECH ™ what this means for winter and the energy markets.

Why does the current global climate support a weather situation similar to 1966 sometime in early to mid 2020? A severe 2nd half of winter in the US.

See a cool video here

*Some ideas and thoughts about natural gas trading

*Why cocoa price have soared the last week or so

What about December weather? I will discuss this in the free report by emailing me at subscriptionsbestweather@gmail.com