Natural gas spot prices up due to cold weather

Petroleum News Alaska Staff

The U.S. Department of Energy's Energy Information Administration said the first week of January that natural gas spot prices in the Midwest and East moved up during the holiday period due to cold weather, with prices in Chicago close to $3 a million Btu the last week of the year, and prices in New York City approaching $5 an MMBtu.

Nymex futures prices for February declined in recent trading due to higher-than-normal storage levels, which the EIA said “continue to be the main contributor to the current strong natural gas supply situation.” The agency said an estimated 2.9 trillion cubic feet of gas remained in storage as of Dec. 21, close to 1 Tcf more than last year at this time.

The EIA said spot prices in many Lower 48 markets reached their highest levels this heating season on Dec. 31, with prices for delivery to many East Coast markets moving up sharply. But even with these sharp price increases, prices remained well below last year’s near record-setting daily prices of late December and early January of more than $10 per MMBtu at the Henry Hub.