Sunday , February 28 2021
Home / Commodity Blog / Natural Gas Retreats 4% as US Supply Withdrawal Disappoints Again

Natural Gas Retreats 4% as US Supply Withdrawal Disappoints Again

Summary:
Natural gas futures retreated on Thursday after soaring as high as .30 in overnight trading. Natural gas has been on a tear this week amid fierce winter weather conditions that have slammed into the US, resulting in power outages, production disruptions, strengthening demand, and speculation of lower inventories. But with the worst of the storm expected to be over, are natural gas prices set to return to below ? March natural gas futures plunged %excerpt%.13, or 4.04%, to .089 per million British thermal units (btu) at 14:41 GMT on Thursday on the New York Mercantile Exchange. Natural gas has soared about 8% this week, bringing its year-to-date rally to above 20%. According to the US Energy Information Administration (EIA), domestic natural gas inventories declined 237 billion cubic feet

Topics:
Andrew Moran considers the following as important:

This could be interesting, too:

Vladimir Vyun writes WTI Crude Rises Above Again, Natural Gas Demonstrates Losses

Andrew Moran writes Commodities Week in Review: February 15 to February 19

Andrew Moran writes Commodities Corner: Middle East Tensions, Winter Blues Lift Energy Prices

Andrew Moran writes Commodities Week in Review: February 8 to February 12

Natural gas futures retreated on Thursday after soaring as high as $3.30 in overnight trading. Natural gas has been on a tear this week amid fierce winter weather conditions that have slammed into the US, resulting in power outages, production disruptions, strengthening demand, and speculation of lower inventories. But with the worst of the storm expected to be over, are natural gas prices set to return to below $3?

March natural gas futures plunged $0.13, or 4.04%, to $3.089 per million British thermal units (btu) at 14:41 GMT on Thursday on the New York Mercantile Exchange. Natural gas has soared about 8% this week, bringing its year-to-date rally to above 20%.

According to the US Energy Information Administration (EIA), domestic natural gas inventories declined 237 billion cubic feet in the week ending February 12, lower than the median estimate of 252 billion cubic feet. This is the second consecutive week that the supply withdrawal has come in lower than forecasts, despite the polar vortex engulfing much of the US.

In a separate report, the EIA projected that natural gas output is forecast to slump by 560 million cubic feet per day from February to March, with most major producing regions anticipated to slow over the next month. The Drilling Productivity Report (DPR) also highlighted that stockpiles are declining in seven regions, led by Permian, Bakken, and Eagle Ford.

The record-breaking deep freeze is blanketing much of the US this week, decimating the power grids in many states, including Texas and Oklahoma. The burst of cold temperatures and heavy snow is affecting more than 100 million Americans, extending from the northeast to the south.

The situation has gotten so bad in Texas that Governor Greg Abbott prohibited producers from selling natural gas outside the state amid production outages and heavy demand volumes. Moreover, liquefied natural gas (LNG) operations have been disrupted as the blast of wintry weather has upended export terminals.

But while demand remains high, weather models suggest that the worst of the bitter cold is over for Texas. Plus, some forecasts suggest that the temperatures could return to seasonal norms by the end of the month.

In other energy commodities, March West Texas Intermediate (WTI) crude oil futures edged up by $0.02, or 0.03%, to $61.18 per barrel. April Brent crude futures rose $0.01, or 0.02%, to $64.36 a barrel. March gasoline futures shed $0.0169, or 0.93%, to $1.794 a gallon. March heating oil futures were unchanged at $1.8242 per gallon.

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


© AndrewMoran for Commodity Blog, 2021. | Permalink | No comment |
Published under: Natural Gas

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 *