Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities


Natural Gas Strengthens on Decline of US Supplies

March 1, 2018 at 18:00 by Andrew Moran

Natural gas futures surged on Thursday after a new US government report showed a significant decline in domestic inventories. With supplies sliding below the five-year average, natural gas prices could reverse last month’s trend when it posted a 6% drop.

April natural gas futures rose $0.04, or 1.5%, to $2.707 per million British thermal units (btu) at 16:40 GMT on Thursday on the New York Mercantile Exchange.

Year-to-date, natural gas has tumbled about 1%.

According to the US Energy Information Administration (EIA), natural gas domestic stockpiles plunged by 78 billion cubic feet for the week ending February 23. Analysts had originally projected a decrease of 79 billion. Total stocks now stand at 1.682 trillion cubic feet, which is down 680 billion cubic feet from the same time a year ago, and 372 billion under the five-year average.

On Wednesday, the EIA reported that US oil supplies edged up three million barrels, while domestic crude output climbed by 13,000 barrels per day (bpd) to 10.283 million bpd. Gasoline stockpiles rose by 2.5 million barrels, while distillate supplies slid one million barrels.

Crude is trading lower on Thursday. April West Texas Intermediate (WTI) crude futures tumbled $0.35, or 0.57%, to $61.29 per barrel. April Brent crude futures shed $0.60, or 0.93%, to $64.13 a barrel.

The US oil industry celebrated when the International Energy Agency (IEA) reported that the US will surpass Russia by next year as the world’s largest crude producer thanks to the shale-oil revolution. With Moscow and the Organization of the Petroleum Exporting Countries (OPEC) slashing output to boost prices, the US is taking advantage of the situation and ramping up production volumes.

In other energy markets, April gasoline futures declined $0.021, or 1.09%, to $1.9036 per gallon. April heating oil futures were flat at $1.893 a gallon.

If you have any questions and comments on the commodities today, use the form below to reply.

Leave a Reply