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The Rise or Fall of US Natural Gas Prices in 2Q17

PART:
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Part 8
The Rise or Fall of US Natural Gas Prices in 2Q17 PART 8 OF 8

The Rise or Fall of US Natural Gas Prices in 2Q17

Natural gas prices and the resistance level 

As of April 6, 2017, US natural gas prices are above their 20-day, 50-day, 100-day, and 200-day moving averages of $3.10, $2.90, $3.10, and $3 per MMBtu (million British thermal units), respectively. That suggests a more bullish momentum for natural gas (GASL) (FCG) (UNG) (UGAZ) prices.

If weather drives demand, prices could even breach the key resistance of $3.50 per barrel in the short term. For more on natural gas price drivers and the weather, read Part 1 and Part 2 of this series.

Volatility in natural gas prices can impact the earnings of oil and gas producers such as WPX Energy (WPX), Memorial Resource Development (MRD), Newfield Exploration (NFX), and Southwestern Energy (SWN).

The Rise or Fall of US Natural Gas Prices in 2Q17

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US natural gas price forecasts 

The EIA (U.S. Energy Information Administration) estimates that US natural gas prices could average $2.98 per MMBtu in 2Q17. It averaged $2.96 per MMBtu in 1Q17.

The EIA also estimates that US natural gas prices could average $3.03 per MMBtu in 2017 and $3.45 per MMBtu in 2018. They averaged $2.51 per MMBtu in 2016 and $2.63 per MMBtu in 2015.

The impact 

President Trump’s proposed energy policies could increase US natural gas production. A rise in US natural gas and crude oil production will have a negative impact on natural gas prices.

Read Could Trump Impact US Natural Gas Production and Consumption for more on the natural gas market outlook in 2017. Also read Hedge Funds Increase Bullish Bets on US Natural Gas for more on the natural gas price forecast.

Read What Can Investors Expect in the Crude Oil Market in 2017? and Are the US, Iran, and Libya Delaying the Oil Market’s Rebalance? for more analysis of crude oil prices.

For more energy-related analysis, visit Market Realist’s Energy and Power page.

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