Top of the Morning headlines…China stocks up, so is crude…El Nino forecast to be here all fall and winter…read on
China Bounce, Iran Talks Fuel Crude Bounce: China put in some measures which helped stopped the stock slide, actually seeing the largest in day stock rise in six-years…Greece is trying to work out a new arrangement with creditors…the Iran talks are still ongoing. The current takeaway is crude is up over $1.50 as of 10am eastern. Propane prices are up a penny or so…it is interesting how things can ‘change’ in the headlines day to day, and how the market reacts. For me, I trust the fundamentals of crude and propane and those tell me things are soft.
— NWS (@NWS) July 9, 2015
From the item: “There is a greater than 90% chance that El Niño will continue through Northern Hemisphere winter 2015-16, and around an 80% chance it will last into early spring 2016.”
Not all El Nino’s are the same, so you can’t say ‘Well, the last El Nino led to a warm winter where I live, so that will be the case this year.’ Joe Bastardi at Weatherbell.com, may on May 3rd, 2015, put together his early ideas for this coming winter. One of the analogs he used to create his thoughts, based on the tea leaves he was reading at the time, was 1997.
1997 was the year of the ‘Super El Nino’, one of the strongest ever recorded. The current El Nino that is building is showing signs that it could reach super status…but that is a tricky thing. At the least, there are few doubts that this El Nino will keep building this summer (which will continue to bring wet weather to the corn belt and usher in below average temps).
First Hand Weather will release their early look winter forecast this coming Sunday and I will share that with commentary on Monday, July 13th. But here is what Bastardi’s winter analog looked like back in May, which had the 1997 El Nino factored into it:
Below average on the macro. El Nino is just one factor to take into consideration. Sea Surface Temperatures, and where they are located, is another. On that topic, Bastardi wrote this, also in his May 3rd winter idea post:
“I am convinced the biggest key for the harsh U.S. winters is the northwestern North America ridge.”
Right now, there are copious amounts of warm waters off the coast of Alaska, and all models are forecasting that to persist into the winter…which leads to the polar jet stream having to go North and over the top of the ridge, then it slides down the back (eastern) side of the ridge to form a trough over North America in the winter, which gives us our cold we so desperately want in this industry. The positioning of the warm water pool affects the positioning of the trough and therefore the focus of the coldest air. We can’t know that just yet, but even with El Nino, don’t lose hope for this winter…actual meteorologists aren’t.
Here is the current SST chart…note the Gulf of Alaska
FOR FUN LINK: How American is your state?