Friday , December 6 2019
Home / Commodity Blog / Natural Gas Slides After Larger-Than-Expected Jump in US Supplies

Natural Gas Slides After Larger-Than-Expected Jump in US Supplies

Summary:
Natural gas futures are trading lower toward the end of the trading week after the US government reported a larger-than-expected increase in domestic inventories. Amid multi-year lows driven by ample supplies, the market has gone bearish on the energy commodity. September natural gas futures tumbled %excerpt%.02, or 0.90%, to .213 per million British thermal units (btu) at 18:11 GMT on Thursday on the New York Mercantile Exchange. Natural gas prices slumped 14% in the second quarter, bringing their year-to-date (YTD) losses to just under 23%. Prices are now at their lowest levels since February 2016. According to the US Energy Information Administration (EIA), domestic supplies of natural gas surged by 65 billion cubic feet for the week ending July 26. This is higher than the market forecast

Topics:
Andrew Moran considers the following as important:

This could be interesting, too:

Andrew Moran writes Natural Gas Rises As Prices Look to Spark Rally Ahead of Cold Weather Spell

Ciaran Roe writes LNG displaces Atlantic basin pipe gas, but meets resistance in Asia

Andrew Moran writes Futures Plunge As Natural Gas Set to Record Steep Weekly Loss

Andrew Hill writes An evolving Russian gas industry deserves new clichés

Natural gas futures are trading lower toward the end of the trading week after the US government reported a larger-than-expected increase in domestic inventories. Amid multi-year lows driven by ample supplies, the market has gone bearish on the energy commodity.

September natural gas futures tumbled $0.02, or 0.90%, to $2.213 per million British thermal units (btu) at 18:11 GMT on Thursday on the New York Mercantile Exchange. Natural gas prices slumped 14% in the second quarter, bringing their year-to-date (YTD) losses to just under 23%.

Prices are now at their lowest levels since February 2016.

According to the US Energy Information Administration (EIA), domestic supplies of natural gas surged by 65 billion cubic feet for the week ending July 26. This is higher than the market forecast of 52 billion cubic feet. In total, stockpiles stand at 2.634 trillion cubic feet, up 334 billion cubic feet from the same time a year ago. But this is 123 billion cubic feet below the five-year average.

Cooler temperatures were blamed for the reduction in consumer demand.

Despite topping $2.30 earlier this week, investors are turning sour on natural gas. According to the US Commodity Futures Trading Commission (CFTC), hedge funds and money managers have increased their net bearish positions to their highest levels since November 2015 in the week ending July 23.

Although a heatwave struck the eastern United States to kick off July, the demand was not enough to outweigh domestic supplies. Thanks to the shale revolution continuing in the US, output levels remain at historic highs. But the supply glut could deteriorate in the next couple of years as more countries transition into the energy source.

The International Energy Agency (IEA) recently stated that global consumption advanced by just under 5% last year.

In other energy markets, September West Texas Intermediate (WTI) crude oil futures plummeted $4.39, or 7.65%, to $54.25 per barrel. October Brent crude futures plunged $4.23, or 6.5%, to $60.89 a barrel. September gasoline futures shed $0.10, or 5.5%, to $1.75 per barrel. October heating oil futures fell $0.11, or 5.7%, to $1.85 a barrel.

If you have any questions and comments on commodities today, use the form below to reply.


© AndrewMoran for Commodity Blog, 2019. | Permalink | No comment | Add to

Better Feed from Ozh

Andrew Moran
I am a full-time professional writer. Prior to my self-employment, I worked as a reporter for Digital Journal covering the politics beat and The Toronto Times reporting on the city’s entertainment scene. I currently write mostly about business, marketing and finance

Leave a Reply

Your email address will not be published. Required fields are marked *