Natural gas rig count
In the week ending August 25, 2017, the natural gas rig count fell by two to 180. On a YoY (year-over-year) basis, the natural gas rig count has more than doubled. However, natural gas (BOIL) (FCG) active futures rose 4% on a YoY basis.
Oil rig count could be blamed
Since the peak of 1,606, the US natural gas rig count fell 88.8%. Natural gas supplies increased during this period. The US oil rig count could be behind the rise in natural gas supplies. Natural gas is frequently an outcome during crude oil extraction.
In the week ending August 25, 2017, the US oil rig count fell by four to 759. However, it has consolidated in the range of 750–770 since the week ending June 23, 2017. The natural gas rig count has been almost in the range of 180–190 since the week ending May 19, 2017. Consolidation in the oil and natural gas rig count could be a positive development for natural gas prices.
New well gas production per rig could rise 25% in September 2017 on a YoY basis. It could be a concern for natural gas prices. The above analysis could be important for US natural gas producers (XLE) like Southwestern Energy (SWN) and Antero Resources (AR).
On August 30, 2017, natural gas October 2018 futures traded at a discount of ~$0.03 to October 2017 futures.
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