US natural gas prices hit 13 year high

RJS, Focus on Fracking,

Summary; US natural gas prices hit 13 year high on falling production, falling inventories

Oil prices ended the week lower for the fourth time out of the last five weeks, as the IEA countries joined the US in an unprecedented release of emergency oil reserves . . . after falling 12.8% to $99.27 a barrel last week after China locked down their largest city and Biden announced an unprecedented release of oil from our Strategic Petroleum Reserve, the contract price for US light sweet crude for May delivery opened somewhat lower again on Monday as traders digested the details on the SPR release amid a ceasefire agreement on the Saudi-Yemeni border, but jumped as much as 4% after Saudi Arabia raised prices for most of its biggest customers to record highs for May, and settled with a $4.01 increase at $103.28 a barrel, after Russian violence against civilians in Ukraine led to renewed calls for the EU to officially ban Russian energy exports . . . oil prices then rose more than 2% in early trading Tuesday, after some European leaders pushed for a extended sanctions on Russia’s oil and coal sectors in response to atrocities in the areas surrounding the capital city of Kyiv, but eased in afternoon trading, pressured by a rising U.S. dollar and growing worries that new coronavirus cases could slow demand, and settled $1.32 lower at $101.96 a barrel, after the European Union proposed a phased-out ban on imports of Russian coal, but brushed aside sanctions against Russian oil and gas exports…oil prices turned lower in late morning trading on Wednesday, with May oil falling below $100, after EIA data showed an unexpected build in commercial oil inventories, along with an increase in domestic crude production, and then tumbled more than 5% after the International Energy Agency, or IEA, said it will release 120 million barrels from the reserves of its members into the open market to bridge a global supply shortage. to settle with a loss of $5.73 at $96.23 a barrel, the lowest close since a week after the Ukraine war began . . . oil fell more than 2% in early trading Thursday, pressured by a stronger U.S. dollar following hawkish minutes from the Fed, and details from the IEA of planned coordinated release of 120 million barrels, but recovered to close just 20 cents lower at $96.03 a barrel even as the EU paused on an immediate ban of Russian coal imports, leading to doubts that they would ever be able to effectively sanction Russian oil exports . . . oil prices recovered somewhat on Friday following wire service reports that China’s largest refiners were avoiding Russian cargoes for May loadings, and settled $2.23 higher at $98.26 a barrel, but still ended more than 1% lower on the week, after several countries had announced plans to release crude from their strategic reserves…

Natural gas prices, on the other hand, ended higher for the seventh time in eight weeks after touching a thirteen year high, on falling US gas output and on a bigger than expected decline in gas inventories . . . after rising 2.7% to $5.720 per mmBTU last week as wintery weather lingered across the northern tier of states. the contract price of natural gas for April delivery traded in a narrow range Monday and settled eight-tenths of a cent lower at $5.712 per mmBTU, as forecasts for milder weather over the next two weeks offset early expectations for more demand during the period . . . but prices spurted 32.0 cents to settle at $6.032 per mmBTU on Tuesday, on a preliminary report of a drop in U.S. gas production, on cooler forecasts, and on the possibility that additional sanctions on Russian gas supplies would keep U.S. LNG exports near record highs for months . . . May natural gas contracts then traded from 5% higher to 5% lower on Wednesday before settling down three-tenths of a cents at $6.029 per mmBTU, despite higher forecasts for gas demand over the next two weeks . . . natural gas then spiked 33 cents higher to a 13 year high of $6.359 mmBTU on Thursday, on soaring LNG exports after the EIA reported a late season withdrawal from storage was larger than expected . . . but prices retreated again on Friday and finished 8.1 cents lower at $6.278 per mmBTU, on profit taking following a report of higher output, but still finished 9.8% higher for the week…

The EIA’s natural gas storage report for the week ending April 1st showed that we again had to pull natural gas out of storage, a week later into the spring than normal, as the amount of working natural gas held in underground storage in the US fell by 33 billion cubic feet to 1,382 billion cubic feet by the end of the week, which left our gas supplies 399 billion cubic feet, or 22.4% below the 1,781 billion cubic feet that were in storage on April 1st of last year, and 285 billion cubic feet, or 17.1% below the five-year average of 1,667 billion cubic feet of natural gas that have been in storage as of the 25th of April over the most recent five years . . . the 33 billion cubic foot withdrawal from US natural gas working storage for the cited week was larger than the average forecast for a 27 billion cubic foot withdrawal from an S&P Global Platts survey of analysts, and it was in sharp contrast to the average injection of 8 billion cubic feet of natural gas that have typically been added to our natural gas storage during the same week over the past 5 years, and the 19 billion cubic feet that were added to natural gas storage during the corresponding week of 2021…