Natural Gas Futures Fail to Hold

Natural Gas Futures Fail to Hold

Natural gas futures flirted several times above the psychologically significant $4/mmBtu mark several times Tuesday morning but failed to hold above that line later in the session.

Abnormally high temperatures in Texas and the southern plains will thankfully not last; a cold front moving into the area and other regions is expected later this week and into the extended forecast.

However, according to Dow Jones Newswires, private weather forecaster WSI Corp. also predicted higher temperatures in late September with hot and dry conditions in the interior western U.S. and northern Plains regions, which could further extend demand for electricity from natural-gas-fueled power plants.

Abnormal weather helps boost natural-gas prices by driving demand for gas-fired power plants in the summer and spurring use of furnaces in the winter. Bullish weather forecasts helped push natural-gas futures higher Tuesday as traders began shifting their focus from summer air-conditioning demand to a potentially frigid winter.

Natural-gas futures for October delivery on the New York Mercantile Exchange rose 9.5 cents, or 2.5%, to settle at $3.98 per million British thermal units Tuesday. The contract traded in a range of $3.923 to $4.018 since Monday’s settlement.

Analysts say the coming cold front is unlikely to significantly affect natural-gas inventories, but the wave heralds a winter that meterologists expect to be colder than normal.

“It’s not a real intense demand situation because it’s kind of early in the season, but it should trigger some unexpected overnight demand,” Commodity Weather Group President Matt Rogers said. “A lot of folks are going to start pivoting for the winter season.”

In today’s market, prices are up one minute and down the next. When it comes to buying electricity, timing is everything. At Live Energy, we keep our finger on the market’s pulse—locking in a low rate with the right electricity provider has never been easier. For more information on how we can help you find the right electricity plan for your business, contact us at (877) 810-7770 today.

Commodity Prices ($)

Natural Gas3.885
Crude Oil88.19
Heating Oil2.9475
RBOB Gas2.7382
Coal74.48

 

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