Natural gas (NG) aimed higher after rising from a one-week low due to forecasts that Arctic air would flow into the lower 48 US states, increasing demand for nat-gas for heating. With a second possible cold front this week, the Commodity Weather Group predicted under-normal temperatures for the eastern United States on Friday for the remaining half of next week.
Natural Gas Weekly Stock Report
Price of Nat-gas When the weekly EIA stock report revealed that Nat-gas inventories dropped by -2 bcf, a lower draw than anticipated of -3 bcf. Friday first prolonged Wednesday's declines to a one-week low, indicating ample nat-gas supplies. This put nat-gas holdings +7.2% over their 5-calendar year intermittent average for this period.
Last Friday, BNEF reported that smaller-48 state air out gas production was 104.5 bcf/day (+0.3% y/y). BNEF reported that the lower-48 state's gas demand on Friday was 96.3 bcf/day, or -6.9% year over year. On Friday, BNEF reported that LNG net transfers to US LNG export terminals were 14.1 bcf/day (+4.5% w/w).
Why Is Natural Gas Price Moving Higher?
On the strength of an uptrend in European nat-gas rates to a one-year high, nat-gas prices surged last week to a one-year high last Friday. Following Russia's hypersonic missile launch into Ukraine, the growing severity of the conflict between Ukraine and Russia caused gas prices in Europe to rise.
There is a greater chance that some of the final Russian natural gas supplies to Europe will be cut off because last Thursday, the United States authorized Gazprombank, the last significant Russian banking organization that certain central European nations still use to pay for the gas they purchase from Russia.
