Natural gas prices reach $4 level
by Pinedale Online!
November 14, 2018
After nearly a decade of low prices, natural gas prices have recently been quietly rising, finally breaking the $4/Mcf threshold in early trading on Tuesday, November 13, 2018. This is the highest it has been since 2014. This is an interesting twist since the stock market and oil prices have been dropping to depressing lows and losses.
Conversely, natural gas prices had a more than 10% year-to-date gain at the end of October, and a more than 25% year-to-date gain through the end of mid-November 2018.
Natural gas inventories have been below normal for the past year. This is impacting the market due to the imbalance in inventory supply levels and projected upcoming demand. The demand for domestic natural gas is heavily affected by winter weather. If the upcoming winter is mild, then natural gas consumption could be low enough to restore inventories to normal levels. If weather is colder than normal, the market may tighten more, and industry reports speculate natural gas prices could reach $5/Mcf for some time.
This recent natural gas price increase could also have an impact the natural gas/coal/liquefied natural gas companies and power generation industries as they adjust to the potential implications of possible new trends in costs to produce goods and market pricing structures.