Inventory, Well Closings, Weather: Natural Gas Traders Digest Data as Prices Swing Higher (UNG)
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United States Natural Gas ETF (NYSE: UNG) gapped higher on the open this morning, trading higher by 2.5 percent and adding to weekly gains of more than 8.75 percent.
At $3.274, natural gas futures traded at their highest level since late July. The spike came just ahead of EIA data that was expected to show a build of 78 billion cubic feet last week. The numbers came in at 80 bcf, higher than analyst expectations, but below average for this time of year.
In the past, natural gas has had a very difficult time holding $3.00, but traders are hopeful that prices can breach July’s high and track toward $3.50.
Weather forecasts are expected to be normal for this time of year, and nuclear outages were steady throughout the week and total 16 percent of U.S. capacity.
Yesterday, oil and gas producer Magnum Hunter Resources Corp (NYSE: MHR) said it shut 400 natural gas wells in Kentucky in the current quarter due to reduced natural gas prices and higher transportation costs. This could be leading some traders to believe that other gas companies will follow suit, leading to a decline in production and higher prices. Drilling for natural gas has been in a steady decline for the last 11 months and rig count hit a 13-year low last week, though production remains high.
United States Natural Gas ETF (NYSE: UNG) trades at 21, its highest level since August 1st.
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At $3.274, natural gas futures traded at their highest level since late July. The spike came just ahead of EIA data that was expected to show a build of 78 billion cubic feet last week. The numbers came in at 80 bcf, higher than analyst expectations, but below average for this time of year.
In the past, natural gas has had a very difficult time holding $3.00, but traders are hopeful that prices can breach July’s high and track toward $3.50.
Weather forecasts are expected to be normal for this time of year, and nuclear outages were steady throughout the week and total 16 percent of U.S. capacity.
Yesterday, oil and gas producer Magnum Hunter Resources Corp (NYSE: MHR) said it shut 400 natural gas wells in Kentucky in the current quarter due to reduced natural gas prices and higher transportation costs. This could be leading some traders to believe that other gas companies will follow suit, leading to a decline in production and higher prices. Drilling for natural gas has been in a steady decline for the last 11 months and rig count hit a 13-year low last week, though production remains high.
United States Natural Gas ETF (NYSE: UNG) trades at 21, its highest level since August 1st.
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