Natural Gas Not on Tight Schedule
January 10, 2020
“Tight” supply demand balances typically bring high prices and volatility. As of last week’s draw of 44 bcf from U.S. natural gas in storage has confirmed the bear for many. The EIA reports that stocks are 521 bcf higher than last year at this point. As a result, spot prices continue to languish just north of $2.00/mmbtu.
The March - April spread is often seen as a gauge of the market’s expectations for how tight supplies will be by the end of the Nov-Mar heating season. It has steadily narrowed since winter began and this provides little motivation for producers to fill pipes.