Natural gas up double-digits for 2nd week, after mostly woeful year
Investing.com — Things are beginning to look up for the natural gas bull, after months and months of haplessness.
America’s favorite fuel for indoor heating and cooling reinforced its hold on $3 pricing on Friday as futures on the New York Mercantile Exchange’s Henry Hub scored double-digit gains for a second straight week.
Turnaround in the prospects of gas, which prior to this was stuck at mid-$2 levels for most of the year, came as weather, demand and production synced in the positive to support higher pricing.
Aiding the bull fervor was gas storage data showing a smallish build for last week, contrary to expectations for a larger one, as some lingering warmth before the advent of cooler fall temperatures led to more air-conditioning demand.
“A key driving force behind this price surge is the state of storage as we approach the winter months,” analysts at Houston-based energy markets advisory Gelber & Associates said in a note to the firm’s clients in natural gas.
The analysts noted that weather projections thus far for November, December and January suggested temperatures that weren’t too chilly.
“Despite this, the market remains apprehensive” of an unseasonably warm winter that would translate to little heating demand, the Gelber note said. It added:
“Recent misses in storage injections, tracking below the five-year average, have fundamentally tightened the market on the supply side. Despite the warm winter predictions, these storage anxieties have significantly impacted market sentiments, propelling prices beyond the $3 hurdle.”
The most-active November gas contract on the New York Mercantile Exchange’s Henry Hub settled Friday’s trade at $3.3380 per mmBtu, or million metric British thermal units, up 17.2 cents, or
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