Natural Gas Price– Weekly Recap May 21-25

Natural gas market changed direction and after a sharp rise in prices during the past couple of weeks, natural gas future (June delivery) sharply declined on Friday. According to the recent NG storage update, there was a 77 bcf injection, which is nearly 30 Bcf below the injection from a year earlier.

Following these changes the difference between future and spot shifted between Contango and Backwardation; it reached a weekly average of $0.06/mmbtu.

During last week the Henry Hub spot edged up by 0.39% and the future (June delivery) tumbled down by 6.2%. During May, natural gas spot rose by 21.8% and the future (June delivery) by 9.83%.

Here is a short recap for the developments in natural gas market for the week ending on May 25th 2012:

Natural Gas Market– May Review

table natural gas - 21-25 May  2012The Nymex Henry Hub Future (June delivery) declined during last week by 6.2% and by Friday reached $2.57 /mmbtu; its average daily contraction was 1.22%, but its weekly average price was 3.03% above the previous average price.

The Henry Hub spot edged up during last week by 0.39%, and its average price was 4.09% above 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) shifted between Contango and Backwardation during the week; by the end the gap was nullified.

Natural Gas Charts

The following charts presents Nat Gas (Henry Hub) and future (Nymex Henry Hub) in $/mmbtu between May 21st and May 25th.

Natural Gas price  chart -  21-25 May 2012The first chart shows the change in the direction of NAT Gas (Henry Hub future and spot) as natural gas future and spot declined during the second part of the week.

Natural Gas chart - percent change  21-25 May  2012In the second chart are the daily percent changes of the Henry Hub spot and Nymex Henry Hub future (short term delivery).

NG Storage Update – EIA Report:

According to the recent update, the underground storage (Billion Cubic Feet) rose again for the 9th consecutive weeks, last week the storage levels rose by 77 Bcf; the storage settled at 2,744 billion cubic feet for all lower 48 states; the current NGs storage is 37.8% above the 5-year average, and is also 37.6% above the storage level during the same week in 2011.

The recent NG storage weekly update as of May 18th.

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