Too bad the Biden Administration doesn't care to increase supply of natural gas to prevent pain for the American people. Unfortunately, there is no strategic natural gas reserve to release to artificially hold down the price of natural gas like what Biden has done with gasoline: U.S. Natural Gas Spikes 81% In 7 Weeks, Hits New 14-Year High | Seeking Alpha Think this is bad, just wait until NG goes up another huge amount starting in the fall which will greatly increase the cost of heating homes in the northern belt of the country. Here we go again. This morning, the notoriously volatile natural gas futures, which have taken down numerous hedge funds over the years, jumped to nearly $10 per million Btu and currently trade at $9.75, the highest since July 2008, up 146% from a year ago, and up 350% from three years ago, topping off a series of spikes that started in early July, just when folks got used to the plunge in commodities prices. The June-July plunge in natural gas futures prices had been one of the reasons cited why inflation in the US has peaked. Utility natural gas piped to homes accounts for about 1% of total CPI. In the July CPI reading, utility gas piped to the home fell by 3.6% from June, the first month-to-month decline since January, and a welcome relief after the spikes in the prior months, including +8.2% in June from May, and +8.0% in May from April. Spikes in futures prices don’t immediately translate into higher natural gas prices at home, but eventually they do. And this is another example of the game of inflation Whac A Mole, with price spikes popping up here and there all over again. Natural gas also feeds into electricity prices via power generators, into food prices via fertilizers made from natural gas, and into prices of all kinds of other products.
Withdrawals aren't the same as production. Production goes into pipelines and a substantial percentage in the non-winter months goes into storage. Withdrawals are draws on the natural gas previously produced and stored. A high withdrawal number in late summer reflects big demand for natural gas to power electricity used in air conditioning. Not sure of this but there may also a substantial amount of gas being withdrawn for export to help European nations dependant on Russian natural gas make it through the summer and winter without as much Russian natural gas as they had pre-Ukraine invasion. But the big run up in withdrawals suggests there may be higher prices ahead as we get into the winter drawdown season. But to really understand what is happening with production we need to see storage and production data not withdrawal data
The OP hates capitalism, wants Biden to Nationalize the oil and gas industry like he's Hugo Chaves, so Unamerican. Move to Venezuela if you don't like it here.
The NG news isn't all bad. I own stock in a NG producer and pipeline company and shares were up over 3% on the day. Yea me!
A strategic reserve of natural gas? How would that work? God forbid a terrorist comes along with a cigarette. natural gas is high because - for a decade frackers lost their asses - billions - great for consumers but terrible for investors. They finally wised up and quit creating more oil and gas than demand - shareholders demanded it. - Covid cratered demand, which cut back production even further - Ukraine war. No explanation needed. How is this Biden’s doing??
I don’t understand. Says right here it’s how much comes out of wells. It’s the metric the EIA reports for amount taken out of ground. What am I missing?
NG Futures crashed yesterday from the high because of Freeport start delay. Arbitrage seekers on LNG exports is going to drive up costs. Part of the global supply / demand curve. Has a negative externality to overall inflation problems.
