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Overview: Thursday, April 28 (next release on May 5)
Since Wednesday, April 20, natural gas spot prices have remained relatively unchanged, increasing less than 12 cents per MMBtu at most market locations in the Lower 48 States, while declining less than 12 cents in the Northeast region. For the week (Wednesday–Wednesday), prices at the Henry Hub were virtually unchanged, climbing 1 cent, to $7.11 per MMBtu. Yesterday (April 27), the price of the NYMEX futures contract for May delivery at the Henry Hub expired at $6.748 per MMBtu, decreasing roughly 31 cents, or about 4 percent, since last Wednesday. Natural gas in storage was 1,416 Bcf as of April 22, which is about 29 percent above the 5-year average. The spot price for West Texas Intermediate (WTI) crude oil decreased $1.08 per barrel, or about 2 percent, on the week to $51.37 per barrel or $8.857 per MMBtu.
Spot prices increased less than 10 cents per MMBtu on average since last Wednesday, April 20, at most market locations outside the Northeast despite significant daily variability with increases and decreases of more than 20 cents per MMBtu.Crude oil prices, which had been climbing throughout the week before tumbling 5.5 percent yesterday (April 27), likely contributed to the continuing strength in natural gas prices despite moderating temperatures. The largest increases of 9 and 7 cents per MMBtu occurred in the West Texas and Midcontinent regions, respectively. Prices in the Northeast and Alabama/Mississippi regions registered slight declines, as prices fell 5 and 1 cents per MMBtu on average during the week.Whether increasing or decreasing for the week (Wednesday-to-Wednesday), prices at most markets in the Lower 48 States remain about 20 percent higher than last year at this time. At the New York citygate, prices are $1.24 per MMBtu or 19 percent higher than last year at this time.Similarly, prices at the Henry Hub are about 22 percent above last year’s level.
At the NYMEX, the price of the futures contract for May delivery at the Henry Hub decreased about 31 cents per MMBtu since last Wednesday, April 20, to expire yesterday (April 27) at $6.748 per MMBtu. Similarly, prices for the futures contracts through the 2005 injection season (May 2005 through October 2005) also decreased about 35 cents per MMBtu on average or about 5 percent on the week. Most of this decline occurred in trading late yesterday as crude oil prices unexpectedly dropped nearly $3.00 per barrel or about 5 percent. These declines reversed the gains in the natural gas futures market during the previous 4 trading days, Thursday, April 21 through Tuesday, April 26. Since becoming the near-month contract on March 30, the May contract declined about 65 cents per MMBtu or about 9 percent. Futures prices for delivery during the refill months of 2005 are high for this time of year. For example, the futures strip price for the remaining refill season months (June 2005 through October 2005) is $6.928 per MMBtu, which is about 14 percent above the futures strip price for the same period last year at this time. These relatively high futures prices during the summer months apparently reflect market expectations of persisting tightness in the natural gas market, despite continued high levels of working gas in storage levels relative to the 5-year-average. The 12-month strip, or the average price for contracts over the next year, settled yesterday at about $7.56 per MMBtu, a decline of 51 cents on the week.
Recent Natural Gas Market Data
gas inventories were 1,416 Bcf as of Friday, April 22, with implied net
injections of 73 Bcf, according to EIA’s
Other Market Trends:
EIA Policy for Storage Data Revisions
The Energy Information Administration (EIA) issued a Federal Register notice
on Tuesday, April 26, establishing a new policy that allows for the unscheduled
release of revisions to weekly estimates of working gas storage volumes
reported in EIA’s
LNG Imports Reach Record Levels:
Liquefied natural gas (LNG) imports, still a small share of total imports, have
grown significantly in recent years to record levels. LNG imports surged in
2004 to approximately 652 Bcf, continuing the upward trend from 2003 when LNG
imports reached 507 Bcf. Trinidad and Tobago for the fifth consecutive year was
the source country with the largest volume of imports to the United States,
delivering 462 Bcf in 202 cargos in 2004, which was almost 71 percent of total
LNG imports in 2004, according to a recent report from the Department of
Energy’s Office of Fossil Energy.
Natural gas spot prices increased slightly at most market locations outside of the Northeast region since last Wednesday, April 20. The May futures contract expired yesterday at $6.748 per MMBtu, which is about 9 percent less than its level on March 30 when it became the near-month contract. Working gas in storage climbed to 1,416 Bcf, which is about 29 percent above the 5-year average.
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