Menu
Saturday, 02 November 2013 17:07

GAS PRICES

Written by
Rate this item
(0 votes)

Wow, what a week. Natural gas market gave back the rally seen two weeks ago and then some. Big price spikes came as a result of colder than forecasted temperatures throughout the north east, followed by a week on inactivity, and then the hammer came down. Prompt month gas has fallen off 30 cents per mmbtu since October 14 high. The 12 month strip had crossed the $4.00 level for the first time since June, now it is down to $3.63. This activity was a result of Thursday’s storage report which showed an increase of supply in the gas storage system rising 38 Bcf from the prior week’s measure. Expectations had been that the cold front in the North East would have more of an impact, and bring storage levels down. Spreads between the 12 and 24 month strips closed the week at $0.12 cents, indicating a strong buying opportunity for the 12 month product.

New gas storage levels came out on October 31, for the week ending October 25. The data showed 3,779 Bcf of gas in the system, up 38 Bcf from the previous week, or up 1%. The prior year’s report ending the same week showed 3,899 Bcf in the system, so the levels have come down 3% vs. the comparable period a year ago. That being said, present gas in the system is at around the 5 year average of 3,721 Bcf.

Following this week’s substantial decline, customers should take advantage of a great buying opportunity by locking in their winter gas and electric supply. The wide spread between the 12 and 24 month strip also indicates a buying opportunity for customers looking for 12 month price protection.

Read 1738 times
More in this category: « GAS PRICES GAS PRICES »

Login or Sign In