Natural gas rises 6% on cooler weather forecast and strong LNG exports (NYSEARCA:UNG)

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US natural gas prices (NG1:COM) rose to their highest level since February 2 and stabilized +5.9% at $5.187/MMBtu, fueled by forecasts for more freezing temperatures in key consumer regions like New York City, where lows in the 20s and 30s are expected starting this weekend and will last for several days.

The weather outlook should allow demand for gas fired heating to remain relatively healthy for about a week.

ETFs: NYSEARCA:UNGUGAZF, DGAZ, BOIL, FCG, KOLD, UNL

Higher natural gas prices also come as global demand for gas to replace Russian fuel following the invasion of Ukraine keeps US LNG exports near record highs and European gas prices are more than 6 times higher than US futures.

Russia has supplied 30% to 40% of Europe’s gas, which totaled 18.3 bn cf/day in 2021, but the US is already producing LNG at near full capacity and will not be able to produce much higher volumes of the to export fuel.

Despite overall cooler U.S. weather next week, forecasters are expecting milder-than-normal conditions through at least early April, which should keep heating demand low enough for utilities to start feeding gas into storage this week.

Cheniere Energy recently announced that planned production of the latest trains at its Sabine Pass and Corpus Christi projects has sold out into the 2040s.

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