Natural gas futures are trading relatively sideways on Thursday after the US government reported a weekly supply withdrawal that matched market expectations. The energy commodity is on track for a significant decline after peaking at $3.30 early last week. Are the bears in full control of natural gas markets?
April natural gas futures edged up by $0.002, or 0.07%, to $2.797 per million British thermal units (btu) at 16:19 GMT on Thursday on the New York Mercantile Exchange. Natural gas prices are poised for a weekly loss of about 8%, paring their
According to the US Energy Information Administration (EIA), domestic inventories of natural gas decreased by 338 billion cubic feet for the week ending February 19. The market had penciled in a decline of 333 billion cubic feet, according to estimates from S&P Global Platts. This represented the
In total, US inventories stand at 1.943 trillion cubic feet, down 298 billion cubic feet from the same time a year ago. They are also 161 billion cubic feet below the
Market observers argue that the weekly supply withdrawal would have been a lot higher if it were not for the demand destruction in Texas. Following the massive winter snowstorm that blanketed the Lone Star State, power outages were felt across America’s energy capital, resulting in output disruptions and supply interruptions.
According to a Goldman Sachs research note,
The impact on our
longer-termU.S. gas balance is, in fact, negligible given the combination of warmer weather forecasts for March, and upward revisions to our supply estimates
In the end, it is obvious that the bears are in full control of the market. Despite having the
The weather will now dominate
In other energy commodities, April West Texas Intermediate (WTI) crude oil futures added $0.12, or 0.19%, to $63.36 per barrel. May Brent crude futures dipped $0.09, or 0.14%, to $66.09 a barrel. April gasoline futures shed $0.0088, or 0.44%, to $1.9689 per gallon. April heating oil futures slipped $0.0075, or 0.39%, to $1.8925 a gallon.
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