Natural Gas – Weekly Recap January 14-18

Natural gas (short term delivery) resumed its rally during most of last week and this rally strengthened on the last couple of days of the week following the higher than anticipated draw from storage. According to the latest EIA report, the NG storage declined by 148 Bcf; this fall in the storage might have contributed to the upward trend in natural gas prices on Thursday and Friday. During last week the Henry Hub future (short term delivery) spiked by 7.18%.

Here is a short analysis of the recent changes in natural gas market for the week ending on January 11th 2013:

Natural Gas Market – January Review

The Nymex Henry Hub Future (short term delivery) spiked during last week by 7.18% and by Friday reached $3.57/mmbtu; its average daily change was 1.4%, its weekly average price was 7.48% above the previous average price.

The difference between the NG future and spot prices – future minus spot – was mostly in contango during the week.

Natural Gas Charts

The following charts show the changes in Nat Gas future (Nymex Henry Hub) in $/mmbtu between January 7-11.

Natural Gas price  chart -  January 14-18  2013

As seen in the chart herein, the NG prices (Henry Hub future and spot) spiked during the week.

In the second chart are the daily percent changes of the Henry Hub spot and Nymex Henry Hub future (short term delivery).  The chart presents the changes in the price movement of natural gas during  the week.

Natural Gas chart - percent change January 14-18 2013

NG Storage Update – EIA Report:

Natural Gas Storage

The underground natural gas storage (Billion Cubic Feet) fell during the previous week by 4.46% or by 148 Bcf; the storage reached 3,168 billion cubic feet for all lower 48 states; the current storage is 11.1% above the 5-year average, but 4.4% below the storage during the same week in 2012. During the same week in January 2012 the NG extraction was only 87 Bcf, and the five year average extraction for the parallel week of January was 146 Bcf. This news is likely to further push up the prices of natural gas. Moreover, based on past years, in the weeks to follow the extractions are likely to increase.

This week’s extraction was mostly driven from Eastern consumption region with an 86 Bcf extraction.

For further reading: