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Natural Gas Jumps 1% as US Supplies Fall

March 14, 2019 at 18:10 by Andrew Moran

Natural gas futures are rallying as much as 1% on Thursday as the US government reported that domestic inventories fell in the range of what the market had anticipated. Natural gas prices are trading in the 50-day moving averages, but they are on track for a modest weekly drop.

April natural gas futures rose $0.027, or 0.96%, to $2.847 per million British thermal units (btu) at 17:19 GMT on Thursday on the New York Mercantile Exchange. Year-to-date, natural gas is up about 5.5%, but it is poised for a weekly loss of around 0.5%.

According to the US Energy Information Administration, domestic supplies of natural gas plunged by 204 billion cubic feet for the week ending March 8, which is in line with the median estimate of 208 billion cubic feet. In total, US stockpiles stand at 1.186 trillion cubic feet, down 359 billion cubic feet from the same time in the previous year and 569 billion below the five-year average.

With winter winding down and spring on the horizon, analysts are expecting more sellers in the coming sessions. During the Thursday trading session, the 50-day moving average sat just above the $2.84 level.

But is it premature to expect warmer temperatures once Old Man Winter leaves? AccuWeather unveiled in 2019 spring forecast, much of the US will still be engulfed in winter weather. In the northeast, mid-Atlantic, and Great Lakes, there is a great chance of snow and subzero temperatures. The Midwest and the Plains may have to wait until the end of April for spring-like warmth.

In industry news, the Texas Independent Producers & Royalty Owners Association (TIPRO), an oil and gas trade group, released its 2019 State of Energy Report. It concluded that the Lone Star State is the biggest natural gas producer in the nation, but Pennsylvania is not very far behind.

According to the TIPRO report, Texas produced 8.8 trillion cubic feet in 2018, followed by Pennsylvania with 6.1 trillion cubic feet.

In other energy commodities, April West Texas Intermediate (WTI) crude oil futures tacked on $0.27, or 0.45%, to $58.52 per barrel, which is the fourth straight session gain. May Brent crude futures slipped $0.32, or 0.47%, to $67.23 a barrel. April gasoline futures edged up $0.01, or 0.5%, to $1.74 a gallon. April heating oil futures fell $0.01, or 0.5%, to $1.98 per gallon.

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