Natural Gas Prices Today and Price Prediction
Investing.com — U.S. natural gas prices have plunged to their lowest levels in almost four years as lower demand, on the back of warmer conditions, has coincided with surging production. But the worst may now be over.
At 04:50 ET 09:50 (GMT), the benchmark natural gas futures contract traded at $1.70 per million British thermal units, up on the day, but still close to the lowest level since June 2020, when the Covid-19 pandemic severely hit demand.
Natural gas prices have been hit by a combination of factors.
Firstly, this winter is on course to being the warmest on record, meaning that demand during this crucial period has been hit hard.
Data released earlier this month by the European Union’s climate service showed that global warming has exceeded 1.5 degrees celsius across an entire year for the first time ever.
Secondly, this hit to demand has coincided with surging U.S. gas production, which this month matched December’s record 105 billion cubic feet a day. And supply looks likely to increase going forward.
BP (NYSE:BP) expects the Calypso deepwater natural gas field off Trinidad and Tobago, which it shares with Woodside Energy (OTC:WOPEY), to get the greenlight when a final investment decision is made as early as the end of next year.
Additionally, $6 billion overall was spent on natural gas-focused deals last year, adding on to $10.6 billion worth of deals in 2022, as companies looked to expand their operations to meet demand for natural gas as an energy transition fuel.
“U.S. natural gas inventories are likely to exit the winter at an elevated level of 2.2 trillion cubic feet at the end of March,” said analysts at UBS, in a note dated Feb. 19.
“Prices need to stay low to slow down production growth over the
Read more on investing.com
