Natural gas prices changed direction and for the first time in three weeks the future price declined. On the other hand the NG spot price continued to rise. Following these changes the difference between future and spot shifted from Contango to Backwardation by Friday. The recent fall in oil prices by the end of the week may have contributed to the decrease in natural gas future rate. There was no update for NG storage.
During last week the Henry Hub spot rose by 7.3% while the future (August delivery) fell by 1.42%. During last month, natural gas spot increased by 16.6% and the future (short term delivery) by 16.53%.
Here is a short overview for the recent changes in natural gas market for the week ending on July 6th 2012:
Natural Gas Market– July Review
The Nymex Henry Hub Future (short term delivery) declined during last week by 1.42% and by Friday reached to $2.78 /mmbtu; its average daily change was -0.25%, its weekly average price was 3.91% above the previous average price.
The Henry Hub spot increased during last week by 7.3%, and its average price was 2.17% above the previous average price.
The difference between the NG future and spot prices, i.e. future minus spot (if the spot is higher than the future it is named Backwardation, if future is higher than spot it is named Contango) was mostly in Contango during the week but finished the week in Backwardation; by the end the difference fell to -$0.16, i.e. Backwardation.
Natural Gas Charts
The following charts present Nat Gas (Henry Hub) and future (Nymex Henry Hub) in $/mmbtu between July 2nd and July 6th.
The first chart presents the changes of NAT Gas (Henry Hub future and spot) as natural gas future and spot had a mixed trend as the spot price rose while the future price declined.
In the second chart are the daily percent shifts of the Henry Hub spot and Nymex Henry Hub future (short term delivery).
NG Storage Update – EIA Report:
This week there was no EIA report on natural gas or an update on the underground storage (Billion Cubic Feet); the storage is still at 3,063 billion cubic feet for all lower 48 states; the NGs storage is 25% above the 5-year average, and is also 27.1% above the storage level during the same week in 2011.
The recent NG storage weekly update as of July 22nd.
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