U.S. NatGas Gains as Energy Firms Struggle to Restart Post-Ida
(Reuters) — U.S. natural gas futures gained on Friday as significant output remained offline in the aftermath of Hurricane Ida, exacerbating supply concerns in an already tight market.
Front-month gas futures for October delivery rose 29 cents, or 0.6%, to $4.67 per million British thermal units (mmBtu) by 10:06 a.m. EDT (1406 GMT). Prices hit a more than two-year peak on Thursday.
U.S. pipeline exports to Mexico rose to an average 6.3 bcfd so far this month, from 6.2 bcfd in August, but were slightly lower than June's monthly record of 6.7 bcfd.
U.S. Gulf Coast energy companies have advanced efforts to restart facilities, but larger hurdles remain for producers and refiners.
"We normally expect a quick recovery in production from hurricanes and this time it doesn't look like that's going to happen, so that's raising concerns about adequate storage going into winter," said Phil Flynn, senior analyst at Price Futures Group in Chicago. "Near-term, a test of $5 in the front end of the curve is not out of the question."
A weekly report released on Thursday showing a storage injection of just 20 billion cubic feet (bcf) during the week ended Aug. 27 also supported prices.
Data provider Refinitiv said total U.S. production has averaged 88.6 billion cubic feet per day (bcfd) so far in September, down from 92.0 bcfd in August. Output is also expected to slip further, to 88 bcfd next week.
With European and Asian gas both trading over $18 per mmBtu, compared with just under $5 for the U.S. fuel, analysts have said buyers around the world would keep purchasing all the liquefied natural gas the United States can produce.
But Price Group's Flynn noted that the closure of several key ports in Louisiana due to Ida could temporarily slow LNG exports.
Related News
Related News
- Trump Aims to Revive 1,200-Mile Keystone XL Pipeline Despite Major Challenges
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
- ConocoPhillips Eyes Sale of $1 Billion Permian Assets Amid Marathon Acquisition
- ONEOK Agrees to Sell Interstate Gas Pipelines to DT Midstream for $1.2 Billion
- Energy Transfer Reaches FID on $2.7 Billion, 2.2 Bcf/d Permian Pipeline
- U.S. LNG Export Growth Faces Uncertainty as Trump’s Tariff Proposal Looms, Analysts Say
- Tullow Oil on Track to Deliver $600 Million Free Cash Flow Over Next 2 Years
- Energy Transfer Reaches FID on $2.7 Billion, 2.2 Bcf/d Permian Pipeline
- GOP Lawmakers Slam New York for Blocking $500 Million Pipeline Project
- Texas Oil Company Challenges $250 Million Insurance Collateral Demand for Pipeline, Offshore Operations
Comments