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Natural Gas Declines and Exco Resources Gains More than 5%

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Natural gas price action

Below is our natural gas—crude or precious metals—price and fundamental analysis. For an in-depth look at natural gas and related companies, sectors, and drivers, please refer to our Energy and Power page.

Warm weather estimates drive down natural gas May futures contracts. Gas prices dropped marginally by 0.15%. They settled at $2.64 MMBtu (British thermal units in millions). The United States Natural Gas Fund LP (UNG) tracks the benchmark. It also fell by 0.23% on March 31.

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On March 26, the EIA (U.S. Energy Information Administration) reported that weekly natural gas in storage increased by 12 Bcf (billion cubic feet). Inventories increased to 1.479 trillion cubic feet for the week ending March 20. It’s an increase of 63.6% from the previous year. However, it’s 11% below the five-year average of 1.673 trillion cubic feet.

In terms of volatility, this is the fifth down day for natural gas futures over the last ten days. Over the same period, the average down days have been 0.59% more than the average up days. Natural gas traded in line with other commodities. Crude oil had the worst performance on March 31. Gas futures followed the long-term downward trend. Gas futures lost almost 8.52% YTD (year-to-date).

The Spider Oil and Gas ETF (XOP) was diverging with the price movement of natural gas and S&P 500 prices yesterday. It settled almost 4.34% up for the day.

Yesterday, oil and gas producer Exco Resources (XCO) surged more than 5%. However, oil and gas refining companies like Alon USA (ALJ) and Green Plains (GPRE) were up by 3%. Lower natural gas prices favor natural gas refineries’ margins. These companies were the top gainers in XOP. They account for 3.3% of XOP.

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