Natural gas market zigzagged during the week as the Henry Hub prices changed directions a few times throughout the week. The Henry Hub future price (short term) outperformed the spot price during most of the week. By the end of the week the Henry Hub spot price declined to $3.49/ MMbtu. On the other hand, the Nymex Henry Hub Future Price (November delivery) reached $3.70/ MMbtu – the highest price level in October.
Here is a short review of the main changes in natural gas prices for the week ending on October 14th:
Natural Gas Prices September – Weekly Review and Analysis
Nymex Henry Hub Future Price (November delivery) sharply inclined during last week by 4.49% and reached on Friday $3.70/mmbtu; its average daily change was 1.26%, but its weekly average price was 0.10% below the previous week’s average price.
Natural gas spot price (Henry Hub) also slightly inclined by 2.35% during the week, but its average price was 1.53% below last week’s average price.
The spread between the Henry Hub future and spot gas prices, i.e. future price minus spot price (if the spot prices are higher than the future prices its called Backwardation, if future price is higher than its called Contango) was mostly in Contango throughout the week, and by Friday the gap was $0.21, i.e. contango.
Natural Gas Prices Chart
The following chart shows the daily changes of natural gas prices (Henry Hub) and futures prices (Nymex Henry Hub) in $/mmbtu during October 10- October 14.
The chart shows the weekly development of natural gas spot price and Henry Hub future price as they both had an unclear path during the week with a slight rise.
The second chart presents the daily percent changes of natural gas spot price (Henry Hub) and Nymex Henry Hub future price; they started the week rising, then fell on Wednesday and made a comeback and increased by the end of the week.
EIA Natural Gas Report – Highlights:
The underground natural gas storage (Billion Cubic Feet) rose last week by 3.3% and reached 3,521 billion cubic feet for all lower 48 states – the highest stock level since December 17th, 2010; the current natural gas storage is 2.0% above the 5-year average.
The graph below present the natural gas storage (weekly figures) and Henry Hub natural gas prices in 2011
To sum up, natural gas storage, production and imports increased while natural gas consumption fell during the week of October 7th.
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Previous issues of weekly report: