Natural gas price rally
This series analyzes natural gas prices and fundamentals. For an in-depth fundamental look at oil and gas and related companies, sectors, and drivers, please refer to our Energy and Power page.
September natural gas futures contracts rose by 1.32% and settled at $2.68 per MMBtu (British thermal units in millions) on Tuesday on August 25, 2015. Gas prices rose due to warm weather estimates. Prices rose despite oversupply concerns. Gas tracking ETFs like the United States Natural Gas Fund LP ETF (UNG) rose in the direction of natural gas prices in yesterday’s trade. UNG rose by 1.11% and closed at $12.77 on August 25, 2015.
The warm weather forecast pushed natural gas prices from two-month lows. The southern and western parts of the US might experience warm weather over the next week. However, mild weather could be seen across the Great Lakes, Northeast, and Midwest parts of the US.
The EIA (U.S. Energy Information Administration) is scheduled to release its weekly natural gas stockpile report on August 27, 2015. Last week, the government data showed that natural gas stocks rose by 53 Bcf (billion cubic feet) for the week ending August 14, 2015.
This is the fourth up day for natural gas prices in the last ten trading sessions. Prices fell by 2.76% more on the down days than on the up days in the last ten days. September natural gas futures were among the top performers in yesterday’s trade. Gas prices fell by 7.10% YTD (year-to-date) due to rising natural gas stocks.
Crude oil and natural gas producers like Exco Resources (XCO), Antero (AR), and Rice Energy (RICE) account for 2.75% of the SPDR Oil and Gas ETF (XOP). These stocks’ natural gas production mix is more than 86% of their production portfolio.