Gas Prices Heat Up: Summer Demand Meets Comfortable Storage in Today's Natural Gas Market
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This is your Natural Gas podcast.
Welcome back to the Daily Natural Gas Price Tracker, I am Vanessa Clark, and this is your quick update on what is happening in the natural gas market and today’s natural gas price.
As of this morning in early trading, the front month Henry Hub natural gas futures contract is trading around two dollars and seventy cents per million British thermal units on the main United States futures exchange. Spot natural gas prices at the Henry Hub benchmark are hovering in a similar range, just under three dollars, after a stretch of relatively calm trading.
Natural gas prices have been reacting to a mix of factors. Weather forecasts calling for warmer summer temperatures across much of the United States are starting to boost expectations for air conditioning demand, which increases power burn from natural gas fired power plants. At the same time, underground storage levels remain comfortably above the five year average, which is helping to keep a lid on any sharp price spikes for now.
On the global side, liquefied natural gas exports from the United States remain strong, with steady demand from Europe and parts of Asia as they continue to secure long term natural gas supply. Global natural gas prices, especially for liquefied natural gas in Europe and Asia, are still higher than Henry Hub prices, which supports continued export flows out of the Gulf Coast.
Here are a couple of quick takeaways you can use. First, if you are a consumer, relatively low and stable natural gas prices compared with past spikes are generally supportive of more manageable home heating and electricity costs over the coming months, though regional utility rates still vary. Second, if you are following natural gas as a trader or investor, keep an eye on weekly storage reports, updated weather forecasts, and any news on liquefied natural gas export capacity, because those are three of the most important drivers of short term price moves in the natural gas market.
That is it for today’s Daily Natural Gas Price Tracker with Vanessa Clark. Thanks for listening, be sure to subscribe, share this with a friend who watches gas prices, and tune in next time for your next natural gas price update.
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