Natural gas hits 9-month high extending $3 pricing on smallish storage build
Investing.com — US natural gas broke new ground with $3 pricing on Thursday, hitting nine-month highs after data showing a smaller-than-expected storage build last week in America’s favorite fuel for indoor heating and cooling.
The most-active November gas contract on the New York Mercantile Exchange’s Henry Hub hovered at $3.15 per mmBtu, or million metric British thermal units, by 11:37 ET (15:37 GMT). Earlier in the day, November gas peaked at $3.16, the highest for a Henry Hub front-month since $4.39 in January.
“It looks like $3 gas pricing is here to stay,” John Kilduff, partner at New York energy hedge fund Again Capital, said, commenting on the run-up.
Wednesday’s rally in gas came after the US Energy (NASDAQ:USEG) Information Administration, or EIA, reported a build of just 86 billion cubic feet, or bcf, in storage of the fuel during the week to Sept. 29, versus the 94 bcf expected by industry analysts tracked by Investing.com. In the prior week to Sept. 22, storage rose by 90 bcf.
The smaller-than-expected build was likely caused by higher power burns by utilities last week as some lingering warmth before the advent of cooler fall temperatures led to more air-conditioning demand.
Total gas in US storage was at 3.088 trillion cubic feet as of last week, up 11.6% from a year ago, the EIA said. Earlier this year, the storage was more than 20% up year-on-year. On a five-year basis (2018-2022), inventories were just 5.3% higher, down from double-digits earlier this year.
Since their last foray into sub-$2 territory in April, gas futures have climbed some 65%, with weather, demand and production all coming together to support higher pricing.
But the ride higher has been a stormy one for gas bulls, who for the lack of
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