A couple of weeks ago we talked about the difference between the $4.14/MMbtu average price (HH) for natural gas storage injection in 2011 versus the average YTD withdrawal season price of $3.20 at the time ---$0.95 below the injection number. Now Feb futures have fallen below $2.70, or $1.44/MMbtu below the injection season value. So the implications then are even more true now – motivation for storage players to hold volumes in storage through the end of the withdrawal season, stronger possibility for 2 TCF remaining in storage at the end of the withdrawal season, etc.
Daily Energy Blog
Thursday, 1/12/2012
Front page article today in the WSJ “Glut Hits Natural Gas Prices”. With front month futures hitting $2.774/MMBtu (lowest front-month price since Sept. 2009, lowest winter since 2002), and Henry Hub cash at $2.808/MMbtu), the non-energy world is finally starting to absorb the magnitude of the shale overhang. Heck, this would have happened in 2010 and 2011 if weather had not saved the day. This year, no weather and no save.
Wednesday, 12/28/2011
January natgas futures closed at $3.112/MMbtu yesterday with no signs of strength in the market. Production remains strong while the weather outlook is above normal through much of the high demand market area. Freeze-offs have been minimal.
