09:39 AM EST, 02/19/2021 (MT Newswires) -- Benchmark natural-gas prices turned higher early on Friday as an unprecedented cold snap in the U.S. continues to boost demand while frozen wells cut into supply.
Gas for March delivery was last seen up US$0.05 to US$3.13 per million British thermal units.
Texas on Wednesday limited gas exports outside of the state as it looks to restore heat and power to millions of homes and businesses as it copes with the record cold that has cut production by 12 billion cubic feet per day, according to a Tudor, Pickering & Holt (TPH) report. The National Weather Service on Friday said the system that produced the freeze should soon lift.
"An anomalously cold week across the Southern Plains will begin to come to an end this weekend as an approaching area of low pressure pulls warmer air northward out ahead of it on Saturday. Before that, widespread low temperature records may be broken tonight over parts of eastern Texas and the Lower Mississippi Valley as high pressure shifts into the eastern half
of the country," the agency said in its short-term national forecast.
The Energy Information Administration on Thursday said U.S. gas inventories fell a less-than-expected 237 billion cubic feet last week. However attention is already focusing on next week's report, which could see inventories fall by more than 300-billion cubic feet for just the second time ever.
"Next week will be the big one and the moving parts are plentiful," TPH said in a note "Week-over-week data shows production down 12bcfd, LNG feed gas down 6bcfd, and rescomm up 5bcfd. We also saw record (Canadian) imports, reduced flows to Mexico and a drop in industrial demand as gas was prioritized for essential services ... Early modeling points to a draw of 320bcf but we'll reserve the right to revise this as data is updated."