Natural Gas Rises to a Two Month High as Extreme Cold Moves into Western States
09:31 AM EST, 01/12/2024 (MT Newswires) -- Natural-gas futures rose to a two-month high early on Friday as bitter cold flows into the Midwest from Canada and a Thursday report showed inventories fell more than expected last week.
Gas for February delivery was last seen up US$0.15 to US$3.25 per million British thermal units, the highest since Nov.6.
The rise comes as bitterly cold temperatures flow into the western states from Canada, with the Washington Post reporting temperatures will be up to 60-degrees lower than normal in some states, with northern Montana reporting wind chills of minus 60 degrees.
"National demand will surge to very strong levels late this weekend through next week as the Arctic shot sweeps across the US w/lows of -20s to 30s, including hard freezes deep into Texas and the South w/lows of 0s to 20s and where colder trends have occurred the past few days," NatGasWeather noted.
The Energy Information Administration on Thursday reported US natural-gas inventories fell by a more than expected 140-billion cubic feet, leaving stocks at 3.37-trillion cubic feet, 11.6% above the five-year average.
"Last week's draw of 140bcf came in tighter than the Street ~121bcf draw (TPHe 140bcf draw) and tighter than the 5-year average (89bcf draw," Tudor, Pickering, Holt analyst Matt Portillo noted.