Natural gas market started to heat up again as natural gas future price hiked on Thursday following the U.S EIA NG report. According to the recent NG storage update, there was a 67 bcf injection, which is nearly 2 Bcf below the injection from a year earlier. The expectations were higher (an injection of nearly 75 Bcf); furthermore the production level didn’t rise. As a result the NG future price hiked by nearly 15% in a single day.
Following these shifts the difference between future and spot remained mostly in Contango; it reached a weekly average of $0.072/mmbtu.
During last week the Henry Hub spot rose by 9.87% and the future (short term delivery) by 7.39%. During June, natural gas spot increased by 4.26% and the future (July delivery) by 2.07%.
Here is a short recap for the developments in natural gas market for the week ending on June 15th 2012:
Natural Gas Market– June Review
The Nymex Henry Hub Future (short term delivery) rose during last week by 7.39% and by Friday reached $2.47 /mmbtu; its average daily growth was 1.65%, its weekly average price was 2.19% below the previous average price.
The Henry Hub spot also hiked during last week by 9.87%, and its average price was 3.85% below the previous average price.
The gap between the NG future and spot prices, i.e. future minus spot (if the spot are higher than the future its called Backwardation, if future is higher than its called Contango) was mostly in Contango during the week; by the end the difference reached $0.02, i.e. Contango.
Natural Gas Charts
The following charts presents Nat Gas (Henry Hub) and future (Nymex Henry Hub) in $/mmbtu between June 11th and June 15th.
The first chart shows the developments in the direction of NAT Gas (Henry Hub future and spot) as natural gas future and spot didn’t do much during the first part of the week. by Thursday the future rate hiked by nearly 15%.
NG Storage Update – EIA Report:
According to the recent update, the underground storage (Billion Cubic Feet) increased for the 12th consecutive weeks, last week the storage levels rose by 67 Bcf; the storage settled at 2,944 billion cubic feet for all lower 48 states; the current NGs storage is 29.2% above the 5-year average, and is also 31.7% above the storage level during the same week in 2011.
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